Rockingham in Rita risk row

Readers' comments (16)

• Anonymous | 4 Mar 2010 10:12 am

  Rockingham rate life settlements as a 3 out of 10 risk alongside AAA rated Corporate Bonds and below Cautious Managed funds. The product has early encashment penalties, is potentially illiquid and could see returns diminish in the future as we have seen with many other so called new investment solutions. Some advisers may consider a very small percentage of a client's portfolio suitable for an investment of this type, but Rockingham's heavy reliance on it to bump up prospective investment returns and make their proposition more attractive is extremely worrying. I have seen quotes where they propose to use 99% of clients Drawdown monies in a life settlement fund and have quoted 10.25% investment returns with illustrations showing that clients can take maximum GAD income and expect to see a growth in their fund value. The FSA have been aware of this for several months, but as usual have done nothing to prevent a problem from escalating before it becomes a major problem. Perhaps this article will now cause the FSA to act.

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• DP | 4 Mar 2010 1:10 pm

  I have also seen one of their illustrations - one of my clients approached them and then asked me to provide the same product. I tried to explain to them that investing 100% of your SIPP into USP with one investment class, especially one which is unregulated, was nowhere near in accordance with their risk profile. As I "couldn't offer" what they were looking for, they are now clients of Rockingham. How Rockingham get away with issuing these illustrations is beyond me?

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• Anonymous | 8 Mar 2010 2:21 pm

  As a U.S. based advisor on Life Settlements, I would not include the use of Life Settlement in any form of retirement plan. With proper planning and policy selection, I believe that the major risks associated with this asset class- including life extension risk, and maintaining sufficient to pay policy premiums, insurance carrier financial stability, etc. can be significantly mitigated. However, the one caveat remaining is that Life Settlements are still for the most part an illiquid form of asset. For that reason, I would not include them or recommend their use in any form of retirement plan or other investment vehicle where liquidity and interim income distributions are required.
  
  While I strongly believe in this asset class, I caution all investors that investments in Life Settlements should only be made with the clear understanding and expectation that the policies will be held until maturity (receipt of policy death benefits) before distributions (return of principal and income) can reasonably be achieved.

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• Mr G R Harland | 19 May 2010 10:07 pm

  I've just received a drawdown plan proposal from Rockingham. Yes they do still use ARM life settlement as part of their proposal but my plan only looks to use about 50% in ARM supported by 22% in Prudential and 25% in Metlife and 3% in a Barclays Cash account. Having read through all the fact sheets provided by Rockingham I'm fully aware of the risks involved and was actually considering asking Rockingham to increase my investment stake in the ARM product. I hope and expect to maintain my investment until maturity and look forward to an investment pot equal to my current stake.

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• Simon Kershaw | 20 May 2010 10:39 am

  Does Mr G R Harland work for Rockingham?
  
  Is he aware of the considerable exposure to Keydata that many Rockingham cients ended up with?
  
  Go away and play with the traffic.

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• Anonymous | 20 May 2010 11:04 am

  So, Simon Kershaw & Associates will not give any reasoned argument with evidence to prove their argument, they will tell you to 'Go away and play with the traffic'. Bet you're real popular. And you wonder why IFA's have the reputation that you have when you come out with ignorant, childish remarks like that one?

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• Phil Castle | 20 May 2010 11:41 am

  To Anon, Simon can be a bit brash at times, but it's not surprising when firms are getting bills for Keydata's collapse when many never used them.
  I have heard of people transferring ALL their pension pot supposedly without any advice from an IFA in to pensions holding 100% in life settlemenments with Keydata. As a non advised sale, if it is found by the FOS that advice was in fact given despite statements to the contrary, is it likely the firm that gave the "non advice" will still be there to meet any legal claim (unlimited) or an FOS claim (limited to £100k usually) or an FSCS claim if they do ceae to trade (don't forget you'll only get 50K)? If it falls to the FSCS, then Simon and I could find ourselves having to put our hands in our pockets yet again for deals we had NO involvement in, so perhaps you'll forgive Simon's bought of unprofessionalism, we all get annoyed at times and in Blogs it's sometimes good to hear the strangth of feeling.
  
  To Mr Harland, can you just verify your true existance as like Simon I do wonder if you and anon 11.04 are plants......

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• Mark Burton | 20 May 2010 12:02 pm

  I invested most of my pension with Rockingham in 2007. They recommended and sold us a Key Data Secure Income Plan. It ended up, unknown to us, as a Lifemark Bond, which is now in default. Some 30,000 of us look like we will lose about £500million. Need I say more?

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• AKA Anon at 11.04 | 20 May 2010 1:04 pm

  Phil
  Thanks for your comments. I offer absolutely no defence for Rockingham and have no relationship with them whatsoever. (Or indeed with Mr Harland). The only reason I chose to comment was because I was quite frankly staggered that a 'proffesional' would make the remark that he did, especially when that person is, unlike myself, in a position where he can quote his name.
  If that is how he wants his Company to be perceived though, then I guess that is entirely his choice! I know where I won't be going when I switch advisors next month.
  
  Will keep my nose out in future.... :)

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• Simon Kershaw | 20 May 2010 3:45 pm

  Thanks Phil. At least my language has moderated if not my outrage.
  
  AKA ANON. I comment, as is my right, under my own name, not hiding behind anonymity.
  
  I recently paid an unjust fee levied by the FSCS. This was due largely to the failure of Keydata, a life settlement fund provider masquerading as an adviser.
  
  Rockingham Retirement was one of the largest investors (of client money) in Keydata funds. Do you detect a pattern yet???
  
  I have no wish for another FSCS levy to cover a SIPP provider failure which turns out to be an "adviser".
  
  It is common for cynical plants to post anonymously on these blogs.
  
  Grow a thicker skin.

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