Laurence Dollimore
A BRITISH expat couple have won a legal battle against the Rothschild bank after being duped into mortgaging their dream home on the Costa del Sol to plunder their cash into supposedly ‘low risk’ investments.
Pensioners Barry and Marion Joyce were about to lose their home in Benalmadena, which had cost them their life savings, after becoming trapped in the sophisticated financial product.
Devised by the Rothschild bank in London, the product targeted British expats who had properties in Spain with no mortgages.
Its allowed them to take out mortgages worth up to 75% of the value of their Spanish homes.
The proceeds were then invested with an insurance company to provide an income.
But things went awry when the investments did not perform as well as promised, leaving the expats unable to pay off their mortgages.
Now a judge from Malaga has condemned the Rothschild bank, ruling in favour of the Joyces.
It is the first sentence to directly condemn N.M Rothschild & Sons Limited and its Credit Select Series Four arm, which marketed the Sitirs product (Spanish Investment Transfer and Income Mobilisation Plan).
More than 100 other cases are set to come before courts on the Costa del Sol and across the Balearics and eastern Spain.
In the fresh ruling, the court in Torremolinos has annulled the entire mortgage and ordered Rothschild to return every penny paid so far by the Joyces.
They have also been allowed to keep the more than €15,000 given to them by the bank as a signing on bonus.
When expats agreed to mortgage their homes, the Rothschild bank assessed their property and immediately gave them 5-10% of the value in cash.
They then used their equity to invest in what were advertised as safe products.
In the case of the Joyces, they took out a loan of €227,000 with the bank which was invested into supposedly ‘low risk’ financial products abroad.
This product would turn out to be life insurance through a company called Aspecta Assurance International Luxembourg SA, which was also condemned in the case.
In the first year alone the couple’s €227,000 was decreased by some €55,443.
By 2016, 10 years after signing onto the deal, the investment had not grown and the Rothschild bank was demanding €302,000 in mortgage repayment from the couple.
If they did not pay their house would be taken from them.
But now a Malaga has ruled the couple, both in their 70s, will keep their home and not have to pay back the sum.
