Three fund directors have sent a letter to Europe’s top regulatory body to complain about a lack of action by Luxembourg’s regulator CSSF to protect investors.
They run several Luxembourg-domiciled funds, known as LFP I, that were defrauded for millions of euros, contends LFP I director David Mapley. Mapley says the CSSF ‘is really obstructing our work’ to recoup the lost funds, he told Investment Officer.
‘Hence my complaint to Esma, since we have identified so much fraud and nothing has been done’, he added. In the letter sent to Esma, Mapley complains about the CSSF’s ‘marketing mission to promote Luxembourg as a financial centre’, which he sees as undermining his efforts to investigate wrongdoing and recover losses incurred by investors in the Luxembourg-domiciled funds.
According to Mapley, the CSSF is more interested in protecting Luxembourg’s reputation as Europe’s biggest fund centre than in protecting investors.
Mapley runs the consultancy Intel-Suisse that specialises in uncovering fraud and recovering assets. He was appointed a director of LFP I by shareholders in December 2018 as part of wider efforts to recover the lost assets. The alleged fraud at the fund mainly revolves around the underhand sale of its assets, according to court documents.