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SFO secures conviction (14 years and seven years sentences) for £100 million fraud.


The Serious Fraud Office (SFO) has secured the conviction of former investment manager David Kennedy for his part in a £100 million investment fraud in which hundreds of people lost their savings, following a re-trial at Southwark Crown Court.

Kennedy and his business partner Timothy Schools managed the Cayman Island registered company Axiom Legal Finance Fund for over two years.

They promised investors a secure return by offering loans to UK law firms pursuing no-win-no-fee cases and where there was purportedly a high chance of success.

An SFO investigation – that has already resulted in Schools being sentenced to 14 years in prison for fraud – uncovered that.

  1. Kennedy used investor money to fund thousands of high-risk cases that needed to be independently vetted and often failed in court. Only some investors ever received a return.
  2. Kennedy diverted over £5.8m from Axiom to pay for items for his benefit, including a Swiss ski resort chalet, a Tenerife villa, and renovations to his home in Hull. These funds were hidden in offshore bank accounts and complex trusts.

After a retrial in 2024, the jury found David Kennedy guilty of:

  1. One count of Fraudulent Trading contrary to s993(1) of the Companies Act 2006 on 3 May 2024.
  2. He was sentenced to 8 years on 7 June 2024.

Axiom Legal Financing Fund

  1. The SFO conducted a criminal investigation into the collapse of the Axiom Legal Financing Fund. This investigation was opened on 10 July 2014.
  2. On 21 August 2020, the SFO charged three men with multiple offences concerning its investigation. Timothy Schools, David Kennedy and Richard Emmett were charged with carrying out a fraudulent scheme to divert money from the Axiom Legal Financing Fund for their benefit.

The outcome of criminal case

  1. On 9 August 2022, following an 18-week trial, Timothy Schools was found guilty by a jury on
    • Three counts of fraudulent trading, contrary to Section 993(1) of the Companies Act 2006,
    • One count of fraud, contrary to Sections 1 and 4 of the Fraud Act 2006, and
    • One count of transferring criminal property, contrary to Section 327(1)(d) of the Proceeds of Crime Act 20022.
  2. Richard Emmett was acquitted of
    • One count of fraudulent trading, contrary to Section 993(1) of the Companies Act 2006, and
    • One count of being concerned in an arrangement which facilitates the acquisition, retention, use or control of criminal property by another, contrary to Section 328(1) of the Proceeds of Crime Act 2002.
  3. On 11 August 2022, Schools was sentenced to 14 years in prison.
    • He was also handed a Serious Crime Prevention Order, which was in place until five years after his release, and a Director's disqualification for 15 years.
  1. After a retrial in 2024, the jury found David Kennedy guilty of
    • One count of Fraudulent Trading contrary to s993(1) of the Companies Act 2006 on 3 May 2024.
    • He was sentenced to 8 years in prison on 7 June 2024.

Confiscation proceedings

  • A three-day confiscation hearing is listed for Timothy Schools on 23 September 2024, and a confiscation timetable is currently being sought concerning David Kennedy.

Appeal against sentence

  • The Court of Appeal dismissed Mr Schools’ appeal against his 14-year sentence on 29 March 2023.

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