How it WorksInvestments offered through AxiaFunder are complex investments and intended for Sophisticated and High Net Worth Investors as defined by the FCA.
Litigation investment has a complex structure, with portfolio litigation funding your investment may be spread over a number of unrelated cases.
When you make a litigation investment, if the case loses, you are likely to lose the whole of your investment unless some of the investment is insured. There is no Government compensation scheme that covers poor investment performance. Even when the prospects of a case look good, there is always a range of factors at play in litigation that mean the risk of it losing should still be regarded as high. The prospect of high returns should not induce you to take risks with money that you cannot afford to lose.
The return on a litigation investment will only come if and when the opponent makes a payment. Even successful litigation generally takes months or years to come to fruition. Investors are able to buy and sell their investments amongst themselves, but there is no recognised market in investments, and you should always be prepared to hold your investment until the conclusion of the litigation.
Litigation funding offers the potential of producing returns even if the economy as a whole is performing badly, but it should always be seen as a high-risk complex investment. It is accepted investment practice to ensure that high-risk uncorrelated investments should form part of a wider diversified portfolio of investments. The minimum investment per case is £1,000
AxiaFunder does not provide investment advice and only seeks investment from investors who have sufficient financial resources and understanding to participate in high-risk investments. Investors who are in any doubt about investing should consider seeking independent professional advice, and you should only invest if you are confident that you understand the general investment risks.
All persons who register as an 'investor' on this Website should read carefully the following warnings before making any investment. All investment products carry risks. The relevant webpages and documents will cover risks specific to an individual offer. Please bear in mind the following general risks involved when investing through this Website:
YOU ARE UNLIKELY TO BE PROTECTED BY THE FINANCIAL SERVICES COMPENSATION SCHEME IF SOMETHING GOES WRONGProtection from the Financial Services Compensation Scheme (FSCS), in relation to claims against failed regulated firms, does not cover poor investment performance. Try the FSCS investment protection checker here.
Protection from the Financial Ombudsman Service (FOS) does not cover poor investment performance. If you have a complaint against an FCA regulated firm, FOS may be able to consider it. Learn more about FOS protection here.
Before it is invested or once the proceeds of investments are returned, your money will be held by the money recipient in a client account and subject to separate protections applicable to credit institutions and banks.
LOSSES CAN EXCEED INVESTED AMOUNTLitigation funding investments carry high risks as well as the possibility of high rewards. Accordingly, each investor should consider very carefully whether such investments are suitable in the light of their own personal circumstances, commitments and available financial resources. Engaging in any investment activity may expose you to a significant risk of losing all of your investment and in some remote circumstances up to double the amount invested.
If a claimant loses a case, it is likely that you will lose all, or part, of your initial investment and receive no outstanding or future interest payments. Alternatively, the litigant may settle the case on terms that do not enable all of the interest and/or capital to be recoverable under the investment or that the defendant has insufficient funds to pay damages to enable all of the interest and/or capital under the investment to be recovered.
For cases with adverse cost risk, we will always put After The Event (ATE) insurance in place. In the unlikely event that this insurance company were to refuse to pay a claim or to fail, you could lose up to double the amount invested.
There are two types of ATE insurance: Standard and Non-Avoidable ATE. For both Standard and Non-Avoidable ATE insurance, the policy provides protection against the liability to pay the adverse costs of the opponent if the case is unsuccessful. However, it should be noted that Standard ATE insurance has some conditions which could enable the insurance to avoid paying out if, for example, the claimant misrepresented their claim or their solicitor was found to be negligent (see blog post by Michael Lent).
In such circumstances neither the Company, nor AxiaFunder nor ShareIn will pay you back your investment or compensate you for your losses. Your losses by investing via the AxiaFunder website can exceed the amount you put in.
The majority of the litigation funding opportunities available via the AxiaFunder platform are complex and high risk. Please be warned that the targeted returns on the documents related to each case are not guaranteed, you could earn less money than expected or nothing at all. This is not a savings account. A higher advertised rate of return means a higher risk of losing your money. If it looks too good to be true, it probably is.
Regarding the accuracy of the information related to each investment opportunity, AxiaFunder always has a signed undertaking by the claimant’s solicitors, confirming that the latter have conducted appropriate due diligence into the facts of the case. Whilst AxiaFunder also undertakes a review on the facts as presented to us by the claimants and other persons associated with the case, we are heavily reliant upon the claimant's solicitors to provide us with information. Please be warned that neither AxiaFunder nor ShareIn are responsible for checking the accuracy of these facts and statements, which may not always prove to be true or complete. The Company is also reliant on AxiaFunder to cover any operating costs shortfalls of the Company that may arise due to fees from service providers.