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The Paraiba Projects Mini Bond

The Paraiba Projects Mini Bond

The Paraiba Projects Mini Bond is yet another investment scheme endorsed by Avacade and related companies that has cost too many pension holders their life savings and left them facing a financially uncertain future.

An exotic and supposedly profitable opportunity

The unregulated introducer Avacade Future Solutions proudly promoted the Paraiba Projects Mini Bond as an excellent investment opportunity for pension holders. 

Potential investors were offered a secure, fixed rate three-year bond giving an annual return of 11%. As with other bond schemes, funds would be lent on to a third party who were to pay 12%, leaving 1% to meet administration costs. The organisation’s main source of income was NE Brazil Investments Ltd, a company ultimately controlled by M Court – one of the directors of Paraiba Project Plc.

The main focus of the scheme was building homes in northern Brazil, specifically a 350-acre residential condominium resort called Brisas de Cocqueirinho Country Club. Paraiba is a densely populated state on the country’s Atlantic coast and more housing was very much in need. To investors, the scheme looking exotic, interesting and potentially profitable.

Unfortunately, the scheme was just another high-risk, Unregulated Collective Investment Scheme (UCIS). It was an illiquid investment recommended to investors through independent financial advisers (IFAs) such as Cherish Wealth Management and Black Start Wealth Management and held as a SIPP investment with SIPP operators like Guinness Mahon.

In the annual accounts for Paraiba Projects covering the period to December 2016, the directors bemoaned that their inability to obtain Sipp funding meant a change of business model. The most recent accounts talked of a new vibrant plan and that the bond was continuing to pay interest at 11%. Sadly for investors, this is no longer the case and they now face an uncertain future.

Were you talked into taking a SIPP?

While transferring a steadily performing pension pot into a SIPP is advisable for some, it’s a strategy that can be fraught with risk and unsuitable for the majority of pension holders. If you have lost money through a SIPP you were talked into taking, our team at Beat the Banks may be able to help.

We have dealt with a number of cases involving Avacade and similar companies, and we have the experience and knowledge to seek the justice our clients deserve. Call 0800 192 1234 to speak to one of our advisors about your case.

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