Laurence Dollimore
ROTHSCHILD bank may be forced to pay back €9 MILLION to British expats over its infamous ‘dodgy’ equity release scheme, a leading lawyer has claimed.
The London-based lender may be forced to cough up the enormous sum after ‘wrongly taking’ the money from hundreds of victims around Spain.
It comes after a Malaga legal firm scored a landmark victory against N.M Rothschild & Sons Limited at a court case in Torremolinos.
As reported on our front page last issue, Brits Barry and Marion Joyce have been awarded €15,000 by the court and had a mortgage on their villa in Benalmadena cancelled.
The couple, now in their 70s, are able to keep their home, which was set to be repossessed, after the judge’s surprise ruling.
Now their lawyer Pablo Espejo, from Iura International, is hoping to get a similar result for a further 20 British clients he is representing around Spain.
All of them had been badly advised to take out mortgages on their Spanish homes and invest them into supposedly low-risk stocks in the early 2000s.
“Rothschild sold a very complex product with a high risk to elderly and retired people who had zero knowledge of financial business,” Espejo revealed.
The product allowed them to take out mortgages worth up to 75% of the value of their homes with the proceeds 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.
“None of the goals advertised, nor the mechanics of the operation were true,” Espejo added.
“Barry and Marion were not professional investors and had no knowledge of financial investments.”
Yet in 2006, Rothschild marketed the product, claiming ‘our clients are not exposed to unexpected risks and therefore offer solutions that reduce as many risks as possible’.
Espejo insists most victims were duped by the prestigious Rothschild name, having ‘no idea’ the product was being ‘mis sold’ and ‘putting their properties at serious risk.’
“Today, all these investments are a fiasco,” he said.
Another British victim, Steve Bicknell, told the Olive Press he was glad that justice was ‘finally being done’.
The Mallorca-based expat said: “The main reason that so many of us were duped is because the scheme was marketed and sold as a legitimate inheritance tax mitigation plan through safe investment.
“This was the main motive, and that which they advertised, and extolled over at their many sales seminars throughout Spain.
“We were not tax experts, just pensioners who trusted the word of such a prestigious and established bank.
“Worse, it later transpired that it did not offer any advantage for tax purposes whatsoever.”
He added: “Thank God finally, after some 14 years, we are starting to see justice done, and peace of mind returned to the victims, so that those of us still around can have our lives back.”
