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Self Invested Personal Pension Providers

Self-Invested Personal Pension Providers

A SIPP (Self-Invested Personal Pension) is a popular choice with some people these days. SIPPs are Government-approved schemes that allow the pension holder to make his or her own decisions about where to invest all or part of their pension pots. They have proved to be a success with many people, but it’s worth noting that they have also become the vehicle of choice for advisors and schemes that have fallen foul of the legal process in recent years.

Up until January 2019, it was perfectly legal for companies to cold call potential investors. This practice has now been banned, but before the ban a huge number of people were targeted by unscrupulous individuals and organisations. They used slick sales pitches, glossy marketing materials and exotic locations to persuade unsuspecting investors to sign up to schemes that promised a great deal but in the end returned very little.

Some even offered supposedly guaranteed returns for the investor. People who were innocently looking to get more from their holdings prior to what they hoped would be a comfortable retirement lost out, while the perpetrators simply got richer and richer. Advice, often extremely pushy advice, was given by unqualified brokers and introducers who made a small fortune in commissions. It was sophisticated, slick and wholly unsavoury.

Money from SIPPs has been lost through a number of now discredited schemes, including investment into such projects as:

• Biofuel
• Forestry
Storage Pods
• Airport Parking
Holiday Resorts
• Hotels
• Plantations
• Property Sales

It’s easy to see now why so many people were keen to invest in schemes that sounded so promising. We can have the benefit of hindsight now, of course, but at the time all these people were looking for was a way of enhancing their pension pots and life savings. They weren’t motivated by greed, they were simply trying to secure a better future for them and their loved ones.

There’s something unpleasant about the way these innocent men and women were subjected to cold calls, coerced by pushy sales experts and tempted by a supposedly safe investment. In truth, these were high-risk investments that really should have been left to people with a high net worth and an in-depth knowledge of the risks that were undoubtedly involved.

Many more compensation cases are likely to be in the pipeline

SIPP providers are supposed to show due diligence when using introducers and brokers to persuade potential investors, but in many cases this didn’t happen at all. These introducers have been found to have given advice that they simply weren’t authorised to do. The recriminations of these practices are likely to run for many years.

Recently, the Financial Ombudsman Service (FOS) ruled against some of those providing unregulated investment schemes, and the likelihood is there will be many more such cases to come. Given the amount of money that has been lost in these schemes, it comes as no surprise to hear just how many people plan to pursue compensation claims in a bid to get some or all of their cash back.

In the more extreme cases, the Serious Fraud Office (SFO) has become involved, and there are several individuals who have since been banned from running companies in this sector. For the more serious offenders, there could even be jail sentences and hefty fines if they go through the courts system. This is a good indicator of just how serious these cases have been.

Looking back now, it seems that certain individuals and certain organisations saw potential investors as something of a soft touch. They subjected them to aggressive selling and made promises that they may have had no intention of keeping. Those who fell victim to this process deserve justice and Beat the Banks can help them to find it.

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