A group of 30 Singaporeans who invested in botched real estate projects in Britain are looking to reclaim their losses by suing the lawyers who had represented them in the multimillion-dollar venture.
They are among 200 investors from various countries who are suing British law firms Scott Fowler Solicitors and Graham & Rosen, alleging that the firms did not inform them about the risks of the investments. They have been working with British law firm Lucas Law to recover about £8 million (S$16 million) in losses.
The Singapore investors said they paid an average deposit of £40,000 for units in seven unfinished hotel and student hostel projects built by now insolvent British developer Key Homes.
These projects are in various cities, including London, Leicester and Birmingham.
Lucas Law director Stuart Lucas told The Straits Times that he has been working with about 200 Key Homes investors since three months ago. They come from places such as Singapore, Malaysia, Hong Kong and the United States.
He said they will file a class action suit against their British conveyancing lawyers from Scott Fowler Solicitors and Graham & Rosen next month for not acting in their interests.
The investors claim that Scott Fowler Solicitors and Graham & Rosen did not tell them that the projects' insurer, Northern and Western Insurance Company, is registered in Caribbean island Nevis instead of Britain. Also, the insurer is not regulated by the British financial authorities.
"The investors would not have put money in the projects if they were told that their deposits were insured by an unregulated and unrated insurer," said Mr Lucas. "Their loss in deposits plus interest is due to the solicitors' negligence."
Ms Helen Young, a spokesman for Scott Fowler Solicitors, said the law firm is aware of the impending class action suit and "has done everything possible to try to assist clients".
Graham & Rosen did not respond to questions from The Straits Times.
In total, about 200 Singaporeans have invested in nine Key Homes projects since 2011. They face the prospect of losing about $20 million.
Of the nine projects, the developer had completed just two: a student hostel in Hull and a hotel in Leeds. They were refurbished from old hotel buildings.
But the Singaporeans who invested in the two completed projects have not received rent for more than a year because of disagreement over the service fees levied by the management firms in charge of maintaining and finding tenants for the buildings.
One of the investors, retired army officer Leong Kok Seng, 56, said: "The lawyers are insured. So I am hopeful of getting some money in damages."
He had paid a £41,000 deposit for a unit in a London hotel.