Wyatt, along with colleagues Halldor Sigurdarson, Magnus Stephensen and investment vehicle Black Pearl Investments, launched their appeal against an order to pay £1.4 million to Goldtrail’s liquidator PricewaterhouseCoopers, at London’s Court of Appeal yesterday.

They are trying to overturn a decision made in 2014, which ordered them to pay compensation after being found to have dishonestly assisted Goldtrail’s director Abdulkadir Aydin in his breach of “fiduciary duty” by misapplying the company’s money.

Goldtrail went out of business in July 2010 leaving thousands of holidaymakers stranded abroad. It was a failure that cost the Air Travel Trust £23.9 million. Aydin disappeared shortly after Goldtrail’s demise.

David Eaton Turner, acting for Wyatt, Sigurdarson, Stephensen and Black Pearl, criticised the “fallacy” of the decision made by the case’s original judge, Justice Rose.

He also claimed that the judge had been “commercially naïve” in her judgment and been “led up hill and down dale” by Goldtrail’s liquidator PwC during the trial two years ago.

Wyatt and the other Black Pearl defendants allege that they were in the process of paying Aydin £1.9 million for a 50% stake in Goldtrail shortly before the operator’s collapse.

The case centres around how this deal with Aydin was structured. This involved a share purchase for £500,000 and a separate “seat sales agreement” for £1.4 million paid to Aydin’s Seychelles-based investment company Morning Light Limited.

The court heard that this arrangement was put in place to reduce Aydin’s tax bill, an agreement that the judge described as a “dodgy deal”.

“This was part of the sham arrangements which have come back to haunt my clients,” said Eaton Turner.

“They were defrauded by somebody who departed for Ukraine without a word and a huge amount of their money. To add insult to injury, they then received a demand for a huge amount of money for being defrauded. They ended up paying twice.

“What they did may not have been commendable. But the dishonesty the judge found was not directed at Goldtrail. It was dishonest towards the Inland Revenue, if anybody at all.”

Lord Justice Vos, one of three judges hearing the appeal, said there was “no doubt they were defrauded by Aydin” who he described as the “big fraudster”.

“They were very unlucky it went belly up. But if you go into this type of dirty deal and it all goes wrong, it tends to go very wrong.

“She [Justice Rose] saw the witnesses and didn’t believe a word they said and thought they were crooks to put it bluntly.”

The appeal continues.