kim

1 Comment

  1. stephen
    September 12, 2018 @ 8:54 am

    it’s a great article until we get to this: “A pension fund is a retail investment that should be placed in a low to medium-risk asset. Fixed terms, high-risk and illiquid investments should be avoided at all costs.” The bit that is contentious is the term “illiquid” coupled with “avoided at all cost”.

    There are many, well regulated OEIC’s available from numerous highly respected platforms, available to UK retail clients, that invest your money in respectable, stable assets like office blocks, shopping malls, warehouses and such like and many pension funds invest in these assets. They are “illiquid” only in the sense that IF a large number of redemption’s were requested they would have to sell some of the assets and that takes time – selling a shopping mall not quite like selling your house! This doesn’t happen often, and last occurred in 2016 after the Brexit vote and some OEIC’s had to suspend trading to cope with redemption demand. However, after several months, the funds coped, and resumed trading again. It is often a wise asset to invest a proportion of a person’s pension or ISA in such funds, they can generate a reliable steady inflation proof income.

    The big issue with scams is they are promoting UNREGULATED investments into “illiquid” assets. They avoid breaking the law (FSMA 2000) by claiming not to be operating as a “collective” (a regulated activity) but are selling you one or more actual “parking spaces”, “storage pod” or leasing you “serviced offices” etc. and you are supposedly making money from the rent of the actual office or parking space you purchased. i.e. if no one parked in your space(s) you don’t earn any income from it. On the face of it, it doesn’t sound like a bad investment but the issue often arises that they are very badly managed. After all NCP operate very successfully with generating income from parking spaces. However scammers often manage these investments very badly and invest in dodgy private ventures by giving out “unsigned loans” to family and friends – e.g. Trafalgar Multi Asset Fund that collapsed a while back.

    However, some scams are often believing they aren’t a collective but in actual fact operate as a collective as far as FSMA 2000 s.235 3(a)&(b) goes (e.g. https://www.fca.org.uk/news/press-releases/fca-wins-case-against-capital-alternatives-limited-and-others ) and there is a compelling argument that Blackmore Global is/was operating as a collective, from evidence that I have, and guess what – when I complained about this to the regulator they didn’t give a sh*t! I don’t know if Blackmore Global is still active or just some dormant Black Hole and by the way, beneficiaries have no idea. Blackmore refuses to publish any audit or publish any details on where the money has gone. This refusal to be transparent in my opinion says a lot about whether it’s black hole-ish or blackmore-ish.

    Take out just one word from the phrase at the top of my comment and it reads much better. i.e. had it read “… high-risk illiquid investments should be avoided at all costs.” and I would have been happy. 😉

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