How to Recover Assets Lost to Fraud or Breach of Fiduciary Duty 

Speed and strategy decide most asset recovery outcomes. The first 72 hours shape your leverage, your disclosure rights, and your ability to freeze value before it vanishes. Effective recovery blends legal tools with forensic intelligence, coordinated across borders and institutions. This guide sets out how sophisticated clients can diagnose the loss, secure the position, deploy the right causes of action, and convert paper wins into money back in the bank. 

At Linkilaw Solicitors, we can assist with asset recoveries. The objective is not to “win the case”, it is to recover value, control narrative risk, and de-risk the next deal. 

The Legal Groundwork: What Are You Proving and Why it Matters 

Before launching applications, define the legal frame. This shapes evidence, urgency, and your right to remedies. 

Common claims 

• Fraudulent misrepresentation and deceit. Knowing or reckless false statements causing loss. Unlocks damages and often supports freezing relief.

• Breach of fiduciary duty. Directors, trustees, and agents must act loyally, avoid conflicts, and not profit from their position. Remedies include an account of profits and constructive trusts.

• Knowing receipt and dishonest assistance. Targets third parties who received or helped with misapplied assets. Useful against enablers and conduits.

• Unjust enrichment. Fills gaps where there is enrichment at your expense without lawful basis.

• Breach of trust. For misapplications by trustees or similar custodial roles.
   

Proprietary and/or personal claims 

• Proprietary claims trace specific value, even through mixes, and give priority over unsecured creditors. They justify search-and-seize style orders and Bankers Trust disclosure.

• Personal claims seek money judgments against defendants. Simpler to plead, but recovery competes with other creditors and depends on enforcement strength.
   

Standards, limitation, and privilege 

• Civil burden of proof is the balance of probabilities. Serious allegations still demand cogent evidence.

• Limitation can be extended by fraud concealment. Do not assume time-bar without analysis.

• Privilege is a strategic asset. Structure internal inquiries through counsel to preserve legal professional privilege.
   

The First 72 Hours: Lock the Perimeter and Preserve Leverage 

The window between detection and dissipation is narrow. Treat this as an incident response, not a slow audit. 

1) Stabilise and preserve evidence 

• Issue legal hold notices. Freeze deletion, backups, and auto-purges.

• Secure email, chat, phone, and device images via forensics. Do not self-collect or “skim”. Chain of custody matters.

• Ring-fence physical records, access logs, and CCTV if relevant.
   

2) Structure counsel-led inquiry 

• Engage external counsel to create a privileged workstream.

• Set a single source of truth for facts, timelines, and document control.

• Notify insurers where required. Consider D&O, crime, cyber, and fidelity policies.
   

3) Stop the bleeding 

• Revoke mandates, disable tokens, and reset approval hierarchies.

• Notify counterparties of revoked authority and disputed transactions.

• Consider targeted press holding lines to control stakeholder risk.
   

4) Courtroom triage 

• Freezing orders to restrain disposal of assets. Ancillary disclosure forces sworn asset lists. Where a third party holds the value for a defendant, consider Chabra relief against that third party.

• Search orders to secure evidence where there is a real risk of destruction.

• Norwich Pharmacal and Bankers Trust orders against banks, exchanges, and service providers to reveal the asset trail.

• Section 25 relief in England and Wales to support foreign proceedings with interim measures.

• Service out of the jurisdiction under the relevant CPR gateways, coupled with orders for alternative service on encrypted email or messaging apps if needed.
   

Building the Claim: Causes of Action, Targets, and Disclosure Strategy 

The best recoveries widen the lens beyond the front-man fraudster. 

Map the ecosystem 

• Primary wrongdoers. Individuals or entities that orchestrated the scheme.

• Enablers. Bank relationship managers, nominee directors, accountants, or corporate service providers who knew or should have known.

• Hubs. Payment processors, exchanges, custodians, and escrow providers.

• Sinks. Real estate, luxury assets, private funds, foundations, and SPVs.
   

Choose the right tools 

• Dishonest assistance and knowing receipt are powerful against professionals who channeled funds.

• Constructive trusts and account of profits convert professional fees and intermediary gains into recovery targets.

• Equitable proprietary claims over mixed funds or converted assets, including crypto tokens.

• Conspiracy where multiple actors combined to injure, opening joint and several liability.

• Insolvency tools where a controlled entity is the wrongdoer. Use examination powers and challenge transactions at an undervalue or preferences.
   

Disclosure and data 

• Sequence third-party disclosure to avoid tipping off. Start where you expect cooperation, then move to contested orders.

• Align court orders with forensic blockchain analysis, KYC files, travel data, and device artefacts.
   

Settlement pressure 

• Pair asset freezes with contempt exposure for false affidavits of assets.

• Use calibrated publicity to encourage cooperation while avoiding defamation or breach of confidence.

• Offer staged deals, for example partial admissions, escrowed repayments, and cooperation statements.
   

The Cross-Border Dimension: Jurisdiction, Service, and Enforcement 

Cross-border features are the rule, not the exception. Treat them as design constraints, not afterthoughts. 

Jurisdiction and choice of law 

• Contractual clauses drive forum and governing law. The Hague Choice of Court Convention can support recognition where an exclusive jurisdiction clause exists.

• Absent a clause, choose a forum with strong interim relief, efficient disclosure, and credible enforcement options. England and Wales is often selected for these reasons.

• Service and evidence rely on the Hague Service and Evidence Conventions, local substitutes, or court-ordered alternative service where defendants hide.
   

Arbitration and court interplay 

• If there is an arbitration clause, use emergency arbitrator relief, then seek court support under the Arbitration Act for freezing and disclosure.

• Consider a hybrid approach. Use arbitration for merits, and parallel court applications against third parties not bound by the clause for disclosure or freezing relief.
   

Crypto and digital assets 

• Courts in major common law centres recognise crypto as property and have granted proprietary injunctions against persons unknown, as well as orders on exchanges.

• Work with chain-analysis providers and target fiat off-ramps. Many recoveries clear at the exchange or bank layer, not on chain.
   

Sanctions and licensing 

• If targets or assets are sanctioned, recovery may require a licence from the UK’s sanctions authority to receive or deal with funds. Factor licensing timelines into the plan.
   

Enforcement strategy 

• For judgments, use common law recognition regimes where treaties do not apply. For arbitral awards, rely on the New York Convention for global enforcement.

• Use receivers, third party debt orders, charging orders, and orders for sale to convert judgments into cash.

• When defendants defy orders, pursue contempt, committal, and debarring sanctions to move the negotiation needle. 

Turning Wins into Money: Funding, Costs, and Risk Management 

Sophisticated claimants manage capital at risk, not just legal arguments. 

Funding options 

• Contingency or damages based agreements in suitable cases.

• Third-party litigation funding to finance merits, evidence, and enforcement.

• ATE insurance to hedge adverse costs and support security for costs arguments.
   

Security, costs, and offers 

• Anticipate security for costs if you litigate through an SPV. Prepare asset evidence or ATE cover.

• Use Part 36 or calibrated Calderbank offers to shift costs risk and signal reasonableness.

• Track spend against recovery tree scenarios, for example base case, upside, and enforcement-only outcome.
   

Reputational and regulatory risk 

• Coordinate with PR and investor relations to avoid unnecessary escalation.

• Keep SAR and AML duties in view when interacting with banks and counterparties.

• Avoid criminal complaints that you cannot control unless they serve a clear civil recovery goal.
   

Key Takeaways 

• Speed is leverage. The first 72 hours define what you can freeze and what you can prove.

• Pair proprietary claims with third-party disclosure to find value fast.

• Treat cross-border steps as a design choice. Build jurisdiction, service, and enforcement into day one.

• Aim for recovery, not rhetoric. Funding, costs, and PR must align with the legal plan.

• End stronger. Use the recovery to harden governance and reduce future risk.
   

If you face a suspected fraud or fiduciary breach, contact Linkilaw Solicitors for a rapid, confidential triage and a recovery plan tailored to your assets and jurisdictions.