What happened: The High Court found a fund manager fabricated returns and awarded approximately £17.5 million
Who's involved: Coleman Capital LLP (in liquidation), its Gibraltar holding company, and their controlling director
What's at stake: Approximately £17.5 million in investment money, none of which has been returned
Why it matters: The fraud finding survives bankruptcy, putting PI and D’O underwriters on notice
Where it stands: Summary judgment entered October 9, 2026; remaining claims stayed
The monthly statements looked fine. They showed steady returns, Goldman Sachs custody, and a segregated account with the investor’s name on it. The custodian’s own trading records told a different story: the entity that actually controlled the money – Coleman Asset Management Group – carried a running negative balance with the custodian that had blown past US$18 million by the end of 2023.
That gap between what an investor was told and what was actually happening with his money is at the centre of a judgment handed down on October 9, 2026, in the High Court’s Business and Property Division. The court granted summary judgment of approximately £17.5 million against Coleman Capital LLP, its controlling director, and a Gibraltar-registered holding company, Coleman (Europe Holdings) Limited. The basis: fraudulent misrepresentation – in plain terms, deliberate deceit.
The investor, a chartered surveyor and businessman, placed a total of approximately £17.5 million with the firm and its director between September 2020 and April 2024. The money fell into three pools: roughly £3.7 million for what was described as the Coleman Funds, about £800,000 in equities transferred from a Kleinwort Hambros portfolio, and £13 million earmarked for a LIBOR-linked deposit account.
The pitch, as documented in emails, presentations, and a formal offering memorandum, was elaborate. The investor was told his money would go into a Cayman-based fund using Goldman Sachs as prime broker, independently administered, audited annually by BDO, and held in a segregated custodian account. He was told he could withdraw at any time.
None of that happened. Evidence from the custodian, Linear Investments Ltd, showed the money was instead routed to Coleman Asset Management Group – another entity controlled by the same director – and used for proprietary trading and to pay out other investors who were redeeming. The director himself conceded in a witness statement that “the accounts were not fully segregated in the way originally described and that the investment profile differed from initial expectations.”
Meanwhile, the investor received monthly statements bearing the firm’s name and FCA registration number, each purporting to show his balances growing with positive returns. The custodian’s trading data painted the opposite picture: Coleman Asset Management Group’s running balance with the custodian was negative by more than US$5 million at the end of 2021, nearly US$11 million by the end of 2022, and over US$18 million by the end of 2023. Data from the custodian showed the director instructed transfers to that entity on the same days the investor’s money arrived.
The investor’s case was that the director must have known the monthly statements he sent were untrue. In his evidence, the director did not say the statements were true, gave no explanation for them, and did not address them at all. The court, in granting summary judgment, found the defendants had no real prospect of a successful defence.
When the investor asked for £1 million back in March 2025, nothing came. When he asked for everything back, nothing came either. The court put it plainly: “Disaster may unfortunately strike the most careful of investment managers. But honest managers do not usually lose everything.”
The defendants never filed an acknowledgement of service or a defence. The director filed a witness statement denying fraud and blaming the losses on third-party failures – principally a default by a company called Omnia Group Holdings AG and the conduct of the custodian. But the court found the defence unparticularised and unsupported by any documentation. In the modern finance world, the court observed, “it is inconceivable that such documentation would not exist and be available to the defendants.”
There was one more detail the court did not overlook. The director, who had been based in the UK throughout the investment relationship, moved to Dubai after proceedings were issued. “The obvious inference,” the court said, “is that he is running away.”
The court entered summary judgment on fraud specifically – rather than a simpler default judgment – for enforcement reasons. Under the Insolvency Act 1986, a debt arising from fraud is not wiped out when someone is discharged from bankruptcy. The director had been bankrupt from August 2025 to August 2026, but the fraud finding means the £17.5 million liability follows him regardless.
The court also set aside the loan agreement between the parties, removing a contractual cap that would have limited liability to 120% of the loans made. A cap in a contract obtained by fraud does not survive once the contract is unwound.
Damages were assessed at £3,669,796.42 for the Coleman Funds, £814,871.64 for the transferred equities, and £13,000,000 for the LIBOR deposit monies. Coleman Capital and the director are liable for the full amount; the Gibraltar holding company is liable only for the Coleman Funds portion. The remaining claims – including claims to trace and recover the actual assets – were stayed, with the investor’s legal team noting the full picture of where the money went remains incomplete.
For PI and D&O underwriters providing cover to regulated investment managers, this is a textbook scenario: fabricated performance reporting, misappropriated client funds, a controlling director who is the sole point of failure – and a fraud judgment that no insolvency process can extinguish.
The claims in this case have been determined by the High Court on a summary judgment application. The court found the defendants liable for fraudulent misrepresentation on the balance of probabilities. The remaining claims to trace and recover assets have not yet been adjudicated. No recovery from the settled fourth party, Linear Investments Ltd, has been disclosed.
