Detectives in Britain and Spain are probing an alleged £120 million fraud mainly targeting expat pension cash.
Thousands of British and expat investors have complained about money placed in storage pod schemes between 2011 and 2017.
The Serious Fraud Office is urging anyone who had dealings with financial advisers recommending the schemes should get in touch.
The hallmarks of the alleged scam included:
- Financial advisers tipping storage pods as investments that would provide higher than average returns
- Investing by raising money from a pension liberation scheme to buy leases on storage pods that would generate a rental income
Unfortunately, few investors saw a return on their cash.
Pension liberation firms closed
Although the promised returns were better than many other investments, most of the funds collapsed leaving retirement savers nursing a loss.
The SFO also revealed Spanish police are helping with the inquiry, which also involves financial regulators.
The police probe follows action by the government’s Insolvency Service to close several financial firms offering suspected pension liberation advice.
Pension liberation is when someone under the age of 55 accesses retirement savings. The legal age for doing so is 55 years old.
The pension firms mainly arranged transfer out of final salary/direct benefit workplace pensions into SIPPs, where the money was then invested in storage pods.
The investments are unregulated, so are not covered by the Financial Services Compensation Scheme, which offers payments to consumers who lose money in regulated investments.
Lawyers ready to take action
The firms allegedly involved are Capita Oak Pension, Henley Retirement Benefit Scheme, the Westminster Pension Scheme and Trafalgar Multi Asset Fund.
All have ceased trading and had their assets frozen.
Lawyers are also preparing cases to sue financial advisers for recommending storage pod investments.
“For many these investments have now turned sour and the returns they initially received have stopped,” said TLW Solicitors.
“Those people then find themselves in the position of owning something which they cannot find a tenant for and/or an asset that they cannot sell. Effectively meaning that their investment in no longer generating a return and may be worth significantly less than the sum they invested.
“If you someone was talked into investing in store pods by a financial adviser it may be that the advice to invest was unsuitable.”