What happened in the Blueinfinitas SIPP misselling scandal had devastating effects on many who had invested their hard-earned pension funds and ultimately lost money in high-risk schemes. Blueinfinitas was an investment company that advised on how people could transfer their pensions into self-invested personal pensions (SIPPs). Now, Blueinfinitas has gone into liquidation and on 11th January 2016 stopped being regulated by the Financial Conduct Authority (FCA).
What Is An SIPP?
A Self-invested personal pension allows people greater control over their finances as they can choose how their funds are invested with a wider range of investment opportunities available. It therefore gives more freedom and flexibility than a standard pension.
It is said that billions of pounds have been lost as a result of high-risk investments due to SIPP misselling scams. High-risk SIPPs that are recommended to victims often haven’t been checked, no due diligence has been conducted and are found to be unsuitable for the individual.
What Happened in the Case of the Blueinfinitas SIPP Misselling Scandal?
In the case of Blueinfinitas, advice was given to invest in unregulated investment companies. The risk in doing this often means that there can be difficulties withdrawing the money back out and the company is not monitored or authorised to give advice by a regulatory body such as the Financial Conduct Authority (FCA). This means that investment opportunities that are advertised or promised by unregulated companies may not be real as there is no higher power checking the validity or legitimacy of them.
Victims therefore placed thousands of pounds worth of their life savings into unreliable investments which resulted in most of their money disappearing or being very difficult to withdraw. In other cases, victims entered into unsuitable investment schemes that did not fit their financial goals and resulted in huge losses.
Blueinfinitas changed its name to Elsborough Financial Services so that it could continue to trade. Since Blueinfinitas and Elsborough Financial Services are officially dissolved and cannot pay out compensation to their victims, the Financial Services Compensation Scheme made £120 million available to those who lost money as a result of Blueinfinitas’ actions.
If your pension adviser did not disclose the risks of moving your funds into a private pension or SIPP and it turns out to be unsuitable for you, high risk or fraudulent, you may be able to make a claim for compensation.
It is a good idea to seek advice from an expert such as Johnson Law Group if you believe you have been mis-sold a SIPP. You may be able to gain compensation for your losses through court but also, The Financial Ombudsman Service (FOS) settles financial disputes between consumers and businesses, and the Financial Services Compensation Scheme (FSCS) can assist too.