Financial watchdogs are warning retirement savers to watch out for scammers after banning pension trustees considered unfit to look after millions of pounds of other people’s money.
John Williams and Susan Huxley were described as lacking ‘integrity, competence and capability’ of running a pension.
They were banned after an investigation in 2013 determined they poorly ran the scheme and a failed legal challenge against the watchdog from the pair.
They ran 5G Pension Futures, a retirement scheme with 529 members who transferred pensions worth around £16 million to be managed by Williams and Huxley.
Millions invested overseas
The scheme ran from 2008 and purported to be a workplace pension even though the company the pension was set up for was dormant.
The watchdog, The Pension Regulator, appointed an independent trustee to manage the scheme’s assets as they suspected it was a pension liberation scam.
The regulator was concerned that retirement savers were cold-called or tested by third parties paid commission for introducing clients.
Money transferred into the scheme was invested in unregulated and exotic assets, such as overseas plantations, biofuel bonds and land.
The £16 million transferred in is now worth about £990,000.
Regulator seeking compensation
The regulator was also concerned some savers transferring into 5G Pension Futures were given loans or cash advances from their retirement savings even though they were under the age of 55 – the legal age when savers can start taking money from a pension.
Nicola Parish, of the regulator, said: “We will take tough action on rogue trustees and are calling on all pension savers, trustees and administrators to be alert to the techniques they use. Beware of the dangers of transferring out of reputable pension schemes to access unrealistically high returns often associated with exotic sounding investment opportunities. If an offer seems too good to be true, it almost certainly is.
“Our concerns in this case led to us appointing an independent trustee and we are confident that our actions have saved hundreds of members from entering the scheme.”
The regulator has a team working on trying to recover compensation for some victims. Some interest on investments has already been recovered.
