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FCA pledges to crack down on unauthorised investment scams

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The FCA says tackling and preventing investment scams will be one of its key priorities for the coming year.

In its business plan for 2016/17, published yesterday, the regulator says it is particularly concerned about the harm that could be caused to consumers who fall victim to scams related to their pension.

The FCA launched its ScamSmart crime prevention campaign last year, which was aimed at consumers at or near retirement. The campaign encouraged consumers to reject cold calls, check the regulator’s warning list before investing and to get advice.

A new phase of the ScamSmart campaign will be rolled out this year, which will include advertising and more information on the FCA website.

The FCA says because only a limited number of investment scams fall within their remit, it will work closely with other regulators and law enforcement agencies through initiatives like Project Bloom, which targets pension scams.

It says it will judge its success on tackling investment scams on whether there is increased consumer awareness of the techniques used by fraudsters, and greater use of online resources to avoid scams.

The FCA says: “We will focus on action against firms and individuals who perpetrate scams. We have a range of enforcement tools to  tackle those engaging in unauthorised business, including civil court action to stop activity and freeze assets, insolvency proceedings and, for the most serious cases, criminal prosecution.”

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Comments

There are 14 comments at the moment, we would love to hear your opinion too.

  1. ScamSmart, Eh ? more advertising and updating the FCA website, Eh? more resource, Eh?
    I bet the fraudsters are quaking in their boots, was it not reported only a few weeks ago they have stopped bothering with small pots of money to concentrate on larger pots

    Could this be, it’s to “bloody” easy to pilfer away some-one’s well earn dosh ? and they a smarter than you ?

    Here is an idea, ditch the scamsmart, advertising, web sit upgrade, and resource……… just make it harder for people to access there pensions, oh, I know, pension liberation can only be done by a registered adviser and into regulated investments, and here is a 500 voucher to boot then we can get rid of pension wise, as well !

    This time money will be going to those who do the work not those who continually mess the whole system up, with stupid ideas thought up in some meeting room designed to waste more money and effort.

    Its about time the public knew how much the peoples champion really costs them !

    Tell me again why I spent hundreds of pounds hundreds of man hours passing stupid exams ? was it only to stay in business to keep paying you and the levies caused by the fraudsters ? crikey I thought I was bettering myself ? that has to be the all time con….. perhaps you can make a film …… call it the “Sting 2”

  2. DH, I blew the whistle on the Henley fund, merco bond bond and rowanmoor, my employer actually gave me a disciplinary warning, more concerned at how two weasels working out of Macclesfield would react.

  3. I asked the FCA last year, via FoI, to confirm its budget for perimeter enforcement giving the then pending ‘pension freedoms’. They responded that as they had a “flexible funding model”, they had no particular budget for this. The takeaway point of course was that they had no budget for this.

    Bona fide firms who pay huge levies to the FCA have been wondering for sometime why they don’t lay off harassing legitimate firms and, well, go chase some real criminals instead.

    • MIB
      “Bona fide firms who pay huge levies to the FCA have been wondering for sometime why they don’t lay off harassing legitimate firms and, well, go chase some real criminals instead.”

      Because its all a big con ! they have no appetite too, lets be honest with ourselves, the FCA need fraudsters to justify their existence to the outside world, huge budget, huge salaries and even bigger ego ! they don’t need such things to justify their existence to us as we are just financial slaves with no right to question, no right to bargain, and no right to set precedence, and no right to common law.

      I have always said, you cannot seek to protect and liberate one section of society by the enslavement and persecution of another.

      I make no joke when I say the fraudsters, criminals and down right incompetent have more rights than we do, at the very least they have the right to have their case heard before they a to be judged guilty !

  4. The horse has bolted!
    “The FCA launched its ScamSmart crime prevention campaign last year, which was aimed at consumers at or near retirement. The campaign encouraged consumers to reject cold calls, check the regulator’s warning list before investing and to get advice.”
    What success , if any, did this have?
    I Like your style DH . Your last paragraph is oh so true. Can I play a bit part in Sting 2?

  5. “….particularly concerned about the harm that could be caused to consumers who fall victim to scams related to their pension.” So presumably they will be sanctioning Osborne and closing No.11.

  6. DH says … “…. Here is an idea, ditch the scamsmart, advertising, web sit upgrade, and resource……… just make it harder for people to access there pensions, oh, I know, pension liberation can only be done by a registered adviser and into regulated investments, and here is a 500 voucher to boot then we can get rid of pension wise, as well ! ”

    I repeat my comment I made last week :-

    Why are the Government and FCA choosing to continue to ignore this on-going SCAM activity ?

    Why do all sensible Advisers have to put up with this on-going fiasco ? This hits us all with bad publicity and financially through higher FSCS fees.

    If someone wants to transfer pension benefits to an overseas scheme, the transfer can only be sent to a scheme which is on the Government’s Recognised Overseas Pension Scheme (ROPS). HMRC only allow schemes which meet certain criteria and they go on to say “Sometimes the list is updated at short notice to temporarily remove schemes while reviews are carried out, for example, where fraudulent activity is suspected.”

    If there was a list created of Recognised UK Pension Scheme (RUPS ?), then Providers would only allow transfers to schemes recognised on the list. At least there would be some kind of order brought to the current chaos. ( Does this sound like pro-active Regulation ? – Do we ever get this from FCA or do we have to wait again until hundreds of horses have bolted ? )

    Where is the FCA – are they doing anything to resolve this problem ?

    _____________________________________________________

    Why do the FCA & Government choose to turn a blind eye to the huge fraudulent activities such as encouraging / arranging for non sophisticated persons to set up their “own” limited company so they can access / transfer pension funds into their own self invested (??) pension which then arranges for the monies to go off to some weird investment that any sane person wouldn’t touch with a bargepole !!

    I despair !!

  7. I despair too. About advisers who don’t understand that SSAS are not within FCA’s remit (it’s up to TPR and HMRC to police those). About all the fools who throw their retirements away investing in magic beans. Really quite a lot about Donna-Marie Hughes, and the damage she’s single-handedly caused. And about – as Harry’s pointed out – the political determination to allow people to be feckless.

  8. Some inescapable truths relating to the Human condition:

    1) Bad people exist and will not hesitate to break laws relating to theft, fraud and worse.

    2) Despite this, laws and rules can (must) be upheld by the majority.

    3) Human greed will continue to ensure that individuals make decisions and enter into arrangements, both financial and personal, which will harm them.

    4) Cliches they may be, but “A fool and his money are soon parted” and “If it looks too good to be true, it probably is”, remain valid and valuable watchwords.

    For too long, the Regulator has pursued a ‘non interventionist’ role, which has failed spectacularly time after time, and needs to change, despite the dangers of becoming a ‘big brother’ regulator.

  9. @Adam Smith Donna Marie Hughes has perhaps done herself £8k of damage by ensuring she can invest her own money. But she has done anybody wanting a legitimate SSAS a big favour.

    The plain truth is that people have a right to a transfer value. The Pensions Ombudsman made up the law in rejecting that right and various old Life Companies have hidden behind it, rejecting all manner of legitimate transfer requests. The High Court has corrected that error.

    Life Companies have plenty of time to assess requests, to identify genuine fraud (and distinguish it from legitimate SSAS activity) and to warn the scheme members (who tend to be sentient adults) accordingly. They can also tip off the authorities. (But note that a scam is a scam – not just an investment people don’t like.)

    Instead Life Companies want us to believe they need to be forearmed in fighting their own customers by taking away this statutory right. Its a nonsense excuse from poor quality providers.

    FCA have the power to close down investment scams, including where the investment is made through a SSAS. The judgment in FCA v Capital Alternatives is clear that the test of an unauthorised collective extends much further than many thought, by virtue of the ‘management as a whole’ test in s.235, FSMA.

    We do not need to undermine the rights of individual consumers to transfer values in order to fight fraud. And if regulation does not give effect to the legal rights of individual consumers, then its not good for much.

  10. Julian Stevens 6th April 2016 at 1:52 pm

    Though I received a ScamSmart leaflet with my most recent share dividend notice, I’ve yet to see one for any of my collective investments or pension plan. When does the FCA plan to start encouraging insurance companies, investment houses and pension providers to start issuing them with every statement?

  11. Trevor Goodbun 6th April 2016 at 4:58 pm

    I have no problem if a fool wants to be parted from their own money just as long as they don’t what me to pay for it. Woops I forgot I will whatever happens

  12. Can anyone point me in the direction of more information regarding the Merco Bond please? Sadly I invested and I am trying to piece together the situation having had little response directly. Thanks for any help

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