A former financial adviser convicted of fraudulent trading in relation to a legal finance fund has been sentenced to eight years in prison.
David Kennedy, 71, was convicted last month for his part in managing the Cayman Island registered Axiom Legal Finance Fund for over two years.
The Axiom Fund lost more than £100 million of investors’ money, Southwark Crown Court (pictured above) heard. Kennedy, wearing a thin blue sweater, was sentenced to eight years in prison on Friday for his part in managing the fund along with former solicitor Timothy Schools.
Kennedy was found to have diverted over £5.8m from Axiom Legal Finance Fund to pay for items for his own benefit including a Swiss ski resort chalet, a villa in Tenerife, and renovations to his home in Hull.
The Axiom Legal Finance Fund was purportedly set up to lend money to firms pursuing no win, no fee claims. It collapsed in October 2012 and investors, who had been promised a ‘secure return’, lost their investments.
A Serious Fraud Office investigation into Axiom was opened in 2014. Schools, Kennedy’s business partner, was sentenced to 14 years in prison after he was convicted of three counts of fraudulent trading and one count of fraud in August 2022.
Speaking at the time of Kennedy’s conviction, Nick Ephgrave, director of the SFO, said: ‘This individual’s criminal actions flooded the legal system with unwinnable cases affecting hundreds of people who suffered financial loss and significant anxiety as a result. This criminality also served to undermine trust and confidence in the legal profession more widely.
‘Our specialist team used their expertise to unpick a complex trail of payments, including into Kennedy’s personal accounts, to secure justice for victims.’
