Freedom Bay property investment
Freedom Bay was a property investment scheme centred around a five-star resort development in the Caribbean. It was promoted as an “eco-luxury” and the complex was to include beachside villas, a spa, gym and other facilities.
Investors were persuaded to put their funds into the project via Self Invested Personal Pensions (SIPPs) and were promised huge returns along with the chance to holiday at the resort through a “fractional ownership” or a timeshare agreement. It may sound like the perfect deal but things quickly went badly wrong for the Freedom Bay project and many investors ending up losing a significant portion of their money.
What went wrong?
One of Freedom Bay’s marketing taglines was that you “don’t have to be a millionaire to buy a share of a home on a Caribbean Island”. This was sadly misleading when in reality unregulated investment schemes like Freedom Bay are only suited to those with significant funds and a large capacity for loss.
Unfortunately for those who did put money into the project, development fell behind schedule and eventually ground to a halt. They saw none of the returns they had been guaranteed and refunds failed to materialise despite an original agreement that refunds with interest would be granted if properties were not completed within two years.
Malgretoute Hotel Development Company Ltd, the company behind the project, had accumulated debts of $54 million to secured creditors alone, $45 million of which was attributable to Heritage, a Guernsey-based Trust Company which took in funds from pension providers and individuals, then on-lent them to the developers.
Many investors who put their hard-earned pension funds into Freedom Bay on the recommendation of IFAs and other professionals were sadly deceived and should never have been given that sort of advice. If you lost money as a result of investing in Freedom Bay or a similar overseas property development project, you may be entitled to compensation. Call the Beat the Banks team on 01382 200474 for a free, no-obligation chat about your case.