Investigation — Part One
The Luxembourg Bond House at the Centre of a Storm: Questions over CSM Securities Sàrl
The inquiry that gives rise to the present account did not commence with a regulatory circular or a public announcement. Rather, it began several years ago, when an associate of this publication in Germany was engaged in research for a book concerning the rise and fall of Bankhaus Von der Heydt, once among that nation’s oldest and most venerated financial institutions.
That bank, according to sources familiar with its affairs, was ultimately dragged into failure — and subsequent closure — by a cohort of young financiers whose names, it has since been alleged, became synonymous with Ponzi-style schemes and bond irregularities.
That initial line of enquiry led to a darker destination: a complex international lawsuit involving a Caribbean banking group, MultiBank, which presented itself as a victim. The case introduced two individuals: Stewart Ford and Colm Smith. Public records and regulatory findings indicate that both played significant roles in the financial scandals surrounding Keydata and Lifemark in the early 2010s.
As our associate investigated allegations concerning Mr Ford, Mr Smith and a German banker named Michael Gollits, he became aware of a new venture in Luxembourg. It was suggested that all three were involved.
What followed was a degree of incredulity. Individuals subject to regulatory bans — Mr Ford received a lifetime prohibition and a £75 million fine from the UK’s Financial Conduct Authority following the £475 million collapse of Keydata — or who had been publicly linked to large-scale financial failures, appeared nevertheless to be trusted by regulators and major financial institutions to sell and administer financial products.
Against that backdrop, earlier this year, our associate discovered a website: CSMSecuritiesScam.com. The site, apparently an investor-activism platform, appeared to be documenting in near real time the default of a bond. After a series of email exchanges with the site’s publishers, the platform was taken down. It is suspected by those affected that CSM or its agents were responsible.
That takedown prompted a cascade of conversations with individuals either directly affected by CSM’s alleged activities or grappling with the legal and regulatory fallout. Those sources agreed to provide documentation and corroborating testimony — including the documents referenced throughout this account as [CS001] through [CS023] — to help shed light on what has been described as a tangled web.
The Story So Far
Since 2020, Luxembourg-based CSM Securities Sàrl has issued a series of bonds, marketed by Regal Consultancy International, to raise capital for the purchase of non-performing loan (NPL) portfolios from major US banks.
However, according to documents and witness accounts, investors were not told that these bonds were designed and structured by Stewart Ford — a figure best known for his lifetime ban from the UK financial industry and a £75 million fine following the Keydata collapse in 2009.
The Keydata collapse in the UK was mirrored by the failure of an associated entity, Lifemark, in Luxembourg. That entity had been established and operated by Colm Smith, described as a longtime associate of Mr Ford and, it is reported, the sole shareholder of CSM Securities. The portfolio manager for CSM’s NPL portfolio was Michael Gollits, previously associated with Von der Heydt and MultiBank — a connection that sources say carries its own history of controversy.
Beginning in 2020, CSM Securities is alleged to have entered an agreement with Regal Consultancy International, run by another associate of Mr Ford, Robert Cormack, to introduce CSM’s NPL bonds to investors and their advisers.
By early 2023, Regal’s Global Sales Director, David Russell, was claiming that CSM’s NPL Bond — referred to as FE1 — had raised nearly £95 million of a £100 million availability, according to documents [CS001], [CS002] and [CS009] seen by this publication.
Investors now allege that this was a fraudulent misrepresentation. Evidence, including Mr Cormack’s own testimony and CSM’s regulatory filings, reportedly shows that the issue had attracted only approximately £8 million at the time those statements were made. These matters are detailed in [CS003] at paragraphs 37 and 38, as well as [CS004], [CS005], [CS006], [CS007] and [CS008].
Over the following two years, investors in the FE1 bond received consistently positive reports about the bond’s performance — documented at [CS010], [CS011] and [CS012] — and coupon payment obligations were met, until August 20, 2025. Upon maturity, the bond defaulted.
Stunned investors were told that instead of a £95 million bond, the subscription stood at only £11 million — and even that amount, they claim, could not be clearly identified. Allegations of fraud swiftly followed.
Four Documents That Tell the Story
This investigation has examined four documents that lay out the narrative in detail: [CS013] the original marketing prospectus shared with investors; [CS014] the report in which CSM announced the default of the bond; [CS015] a transcript of the conference call between bond noteholders, CSM’s Colm Smith, Regal’s Adam Duthie and Robert Cormack, Greenhill Debt Management, and various financial advisers; and [CS016] a follow-up memo from CSM’s agents at RCI, which allegedly omitted several undertakings given to noteholders and their advisers on that call.
The Post-Default Allegations
From the time the bond was issued until it defaulted, bondholders received virtually no direct communication. Instead, their financial advisers relayed CSM and Regal’s assurances about how well the bond was performing.
However, on the noteholder conference call, several advisers began raising explosive questions: Was the bond mis-sold? Why was there no information on the exact composition of the non-performing bank loans? Why had elements of the bond defaulted as early as February — with no notice to holders? Why had the portfolio manager been replaced without any disclosure? Why was CSM now entangled in a series of lawsuits with various counterparties?
According to investors, these events — combined with what they describe as obvious obfuscation by CSM and Regal — led many noteholders to believe they had been defrauded. A pattern of deception, it is claimed, was evident. Sources point to the failure to report the payment default in February 2025 of the Sterling and Euro bonds, the issuance of “Assurance Letters” post-bond default [CS017], and the publishing of what are alleged to be misleading documents on the London Stock Exchange [CS018].
Additionally, it is alleged that CSM and Regal conveniently failed to mention that in August 2024 “the Frankfurt Stock Exchange delisted the bonds, the Vienna Stock Exchange refused to list bonds, no new bond issuances were available for CSM, and the listing agents resigned from their functions for CSM” — a matter recorded at [CS003] paragraph 26.
The Courts Intervene — Sort Of
One group of investors immediately appealed to the Luxembourg Courts, requesting that the extraordinary general meeting (EGM) vote to extend the bond be stopped. The court denied the request — on the narrow basis that the investors had failed to show “irreparable damage” would be caused by the vote. They could, the court said, always sue for claims and damages arising from that action later.
Promises Broken
According to multiple investor accounts, CSM and Regal then failed to provide the promised audit and historical review of the bond’s activities. What little information was provided was of such poor quality [CS019] that it was effectively useless. The website they had promised to set up to permit inter-noteholder communications instead became a two-way communication system allowing CSM and Regal to control the dialogue. The commitments to transparency and the institution of independent reviews were simply forgotten. No meaningful information was shared with noteholders prior to the first EGM. At that meeting, CSM announced it had not received a quorum. The vote was pushed back to a later date.
The Hidden Downgrade
Most critically, during this entire period, CSM never notified noteholders that on September 1, Credit Spectrum — the very same agency whose ratings had been used to promote the sale of the bond — had written to CSM and defaulted both the FE1 bond and the FE6 bond [CS020]. Investors were kept in the dark while the very foundation of the bond’s marketed safety, it is alleged, crumbled.
The Tainted Vote
When the second EGM was held on November 7, CSM claimed that the extension of the bond was approved. However, many of the investors this publication has spoken to say they never received any voting instructions from their asset custodians. They allege the vote was improperly held — if it was held at all. Others point out that they would never have agreed to proceed with a vote before CSM and Regal provided the promised audits and reports.
The Final Insult
February 20, 2026, came and went. No payment of the first coupon due under the so-called “three-year extension” was made. Approximately a month later, CSM issued an update to noteholders [CS021] noting a “deferral of payment” along with an updated cash flow from Greenhill Debt Management [CS022]. The update provided absolutely no information on the promised audit, the appointment of an independent monitor, or an explanation of exactly what the noteholders’ funds had actually been used for.
Legal Action in Luxembourg
There is an ongoing legal action that has been filed in the Luxembourg Courts on behalf of a group of investors [CS023] demanding the appointment of an independent administrator to oversee activities in an attempt to head off bankruptcy. A complaint is being filed with the CSSF, Luxembourg’s financial regulator, requesting its intervention.
Regulatory Complaints in the UK
In the UK, complaints have reportedly been filed with the Serious Fraud Office and the Financial Conduct Authority against both Stewart Ford and Regal Consultancy, as well as its officers and employees. The fact that Mr Ford is operating in the UK — in a manner that some may regard as being in defiance of the FCA’s lifetime ban — is, sources say, shocking enough.
Conclusion
This investigation is far from over. The evidence gathered to date — spanning marketing materials, regulatory filings, court pleadings, internal correspondence, and witness testimony — raises serious questions about the conduct of CSM Securities Sàrl, Regal Consultancy International, and the individuals associated with them. As one investor put it to this publication: “having seen what has been documented, it is difficult to avoid the conclusion that a fraud has been perpetrated.”
End of Part One
Fraud Alert News will continue to update this investigation as documents, testimony and regulatory actions become available.
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