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Broker talkback

Is there a potential for venture capital trusts to be missold?

“Yes. While these things are being sold on the tax benefits, exit strategy is key and investors need to ask how, or even if, they are going to get their money back.”

John Hutton-Attenborough, PKF

“Yes. We do not deal in this market at all. Our clients do not want to be involved in this level of risk.”

Nick Searl, Stanford Ward

“Yes. People could be drawn to the tax benefits of VCTs without being fully aware of the risk and difficulties that may be faced when trying to sell them on.”Colin Donlon, Future Focus Advisory

“It is an area we do not normally advise our clients on but I have seen an increase in marketing material coming down the chain, which others may pick up on without making clients fully aware of the risks.” David Jones, Independent Investment & Financial Services

“Yes. While fairly attractive from a tax-saving point of view going in, there is not much point saving for going in if the investment fails and the whole of the subscription is lost.”

Bob Marris, RN Store & Co

“There is always the potential for misselling, it is the nature of the beast. There should not ever be any misselling but, if clients do not give us full information, it can happen.”

Colin Andrews, Grange Independent Financial Advisers

“I am fully aware of the risks and not a lot of my clients are prepared to take on the underlying risk involved once I make them aware of it.” Bill Hopkins, Premier Financial Associates

“I think the FSA is right to flag it up. They are often sold on the back of tax breaks and I believe in some cases the upside is emphasised more than the downside.” Jonathan James Taylor, J Taylor & Co

Yes 100%

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