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Property products pledge ‘risk-free’ high yield

Seven Continent Investment is offering three property products that it claims are high return with no risk.

It says the plan for the “25 per cent guaranteed return” would see investors providing private financing to a development company in return for guaranteed returns of 25 per cent in the first year, payable as 6.25 per cent of the investment sum per quarter.

It guarantees returns of between 40 and 70 per cent on a two-year investment and the 100 per cent return option pledges that the initial investment sum will be paid back in full after 36 months.

The firm says investors’ money is secured against land or property, free of debts and confirmed by an independent valuer to be worth 100 per cent of the sums held and put in the hands of UK overseas property solicitors ILP to hold in escrow.

7Ci says the products have been created as loans and therefore do not require FSA approval. Investors will not be covered by the Financial Ombudsman Service or the Financial Services Compensation Scheme .

Fund and private finance director Mike Powell says: “Our returns are absolutely guaranteed, deliverable at fixed points in time, providing certainty and confidence in the investment.”

Torquil Clark investments director Philippa Gee says: “You have got to be incredibly cautious about these kinds of schemes. Advisers need to rip the products to shreds, understand them inside out, find out how they are able to guarantee it, why and on what basis. You have to be able to dig deep and make the product stand up in your own opinion.”

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