Tag: OMI

OMI complaint
COMPLAINT TO OMI, THE ISLE OF MAN FINANCIAL SERVICES AUTHORITY, THE CENTRAL BANK OF IRELAND, FINANCIAL SERVICES AND PENSIONS OMBUDSMAN AND THE ASSOCIATION OF INTERNATIONAL LIFE OFFICES

ATTENTION:

Martin Middleton, CEO

Michael Hampson
Complaints Handler | Complaints Team | Old Mutual International

T: 44 (0) 1624 655451 | Int Ext: 75451
F: 44 (0) 1624 611715
E: omifmcomplaints@ominternational.com | W: www.oldmutualinternational.com

Isle of Man Financial Services Authority
PO Box 58
Finch Hill House
Douglas
Isle of Man
IM99 1DT

info@iomfsa.im

GeneralMailbox.ATG@gov.im

Central Bank of Ireland:

enquiries@centralbank.ie

Financial Services and Pensions Ombudsman

Lincoln House, Lincoln Place, Dublin 2, D02 VH29. Tel: (01) 567 7000 Email: info@fspo.ie Website: www.fspo.ie

AILO – Association of International Life Offices

secretariat@ailo.org

COMPLAINT REGARDING OMI’S NEGLIGENCE, FAILED GOVERNANCE AND FACILITATION OF FINANCIAL CRIME – European Executive Investment Bond (EEIB)

OMI has facilitated financial crime over a period of many years; stood by while innocent victims’ retirement savings were destroyed; paid huge commissions to an unlicensed (and illegal in Spain) firm of scammers; continued charging crippling fees while victims’ funds dwindled away; extorted early exit penalties from victims unfairly and unreasonably; failed to take any action to stem the torrent of huge losses of millions of pounds’ worth of retirement savings for many years. And now it is failing to uphold the victims’ complaints.

OMI has been in receipt of a number of complaints (and will be in receipt of numerous further ones) regarding their negligence and facilitation of financial crime in offshore financial services. OMI has not upheld these complaints – and indeed has neglected to grasp the extent of their own multiple failings and errors.

The existing complaints do relate to serious regulatory breaches and fraud – as well as failing to adhere to OMI’s own terms and conditions. Much of the fraud was caused by the financial advisory firm: Continental Wealth Trust (which traded as Continental Wealth Management). However, the firm’s fraud was only successful because OMI facilitated it.

The complaints submitted to date include:
- That investments were made into high-risk professional-investor-only funds. Many of these failed and caused huge losses to victims’ funds.
- That OMI paid commissions/fees to CWM who not only held no investment licence – but also held no license of any kind.
- As a result of the huge, un-disclosed commission paid to CWM – an unlicensed firm – OMI imposes crippling early surrender charges on the victims.
OMI has responded that they are “very sympathetic to victims’ concerns” and has responded that it appreciates what a very worrying time this must be for those who have lost such huge amounts of their life savings.

OMI has also stated that the roles and responsibilities of all the parties involved with this fraud have got to be clarified. However, OMI claims – entirely disingenuously – it does not want victims to get the feeling it is trying to distance itself from the grievances.

In order to address what it refers to as “concerns”, OMI has attempted to “explain” matters. The use of the word “concerns” is obviously a really crass clanger on the part of OMI, since the victims are absolutely not just CONCERNED – they are furious, terrified and devastated at their dreadful losses. Some victims are suicidal, and many have had their health seriously compromised.

OMI has described the EEIB as being held by the trustee for the benefit of a member of their pension scheme, enabling policyholders to hold a “wide range of investments in one tax-efficient product wrapper”. OMI goes on to claim that policyholders and their investment advisers “have complete flexibility over the investments they place inside the EEIB”.

Some or all of the above may be true. However, that does not make it right that OMI has allowed unlicensed advisers to place clearly unsuitable investments inside their wrappers. Further, it does not make it right that OMI then stood by and watched the investments fail for many years AND DID ABSOLUTELY NOTHING EXCEPT KEEP ON TAKING FEES BASED ON THE ORIGINAL VALUE – AND NOT THE REDUCED VALUE OF THE FUND.

OMI claims that it reviews all investments to ensure they meet Irish regulatory requirements, and their own administration requirements.

If this is indeed true, it is a very serious indictment of the Irish regulator if their requirements are so appallingly lax. What OMI seems to be claiming is that both the Central Bank of Ireland and OMI have such low standards that they will allow low-risk pension savers to have their retirement funds invested purely in high-risk, professional-investor-only structured notes. If this is true, then the regulator is as bad as OMI in condoning an investment strategy which has no regard for suitability, liquidity, diversity and risk tolerance.

In fact, the Central Bank of Ireland has stated that it carried out a review of suitability requirements in 2017 and found that: “governance structures for the identification and treatment of vulnerable clients were absent or ineffective”. The CWM victims were about as vulnerable as it was possible to get – as their retirement savings were systematically and inexorably destroyed. And OMI’s governance structure was about as absent and ineffective as it is possible to get while it stood by and didn’t even bother to raise a red flag on the whole disaster as it unfolded.

There was no jangling of alarm bells as OMI watched millions of pounds wiped out. There was no expression of concern that the same toxic structured notes which had failed in earlier years were bought again and again by the same unlicensed scammers. There was no governance to protect new vulnerable victims from having their funds destroyed from 2015 onwards in the same way hundreds of victims had suffered in previous years.

OMI has claimed that customers/their appointed advisers are responsible for the suitability assessment and selection of the investments held in the policy – and that “it is important that customers read the prospectus/offering documents of investments carefully, before making any investment decisions”. However, OMI watched wholesale destruction taking place inside its own wrappers and took no action. Had OMI asked a few simple questions they would have found the following:
1. The victims were being advised by a known firm of scammers which had been involved in cold calling in the Evergreen pension liberation scam in 2012
2. The victims were being advised by a firm which was not licensed at all – for anything
3. The victims had ALL insisted they wanted either low risk or no risk investments as they could not afford to lose any part of their retirement savings
4. The victims had no idea their retirement savings were being invested in high-risk, professional-investor-only structured notes
5. The victims’ signatures were repeatedly forged on the dealing instructions
6. The victims were duped into a false sense of security when losses started to be reported on their statements by the scammers claiming these were not genuine losses but only “paper losses”
7. The victims had no idea how high the charges and commissions were as these were not disclosed either by the scammers or by OMI
8. The victims were not consulted as to whether they wanted or needed an entirely useless and exorbitantly expensive insurance bond
9. The victims were unaware that tied agents are illegal in Spain
10. The victims were unaware of the huge fees and commissions which were concealed by both the scammers and OMI
OMI claims that term 12 of the EEIB policy terms states that it is the policyholder who bears the risk of investment. But then OMI goes on to assert that the policyholder was the trustee who would be classed as a professional investor.

So OMI has got to make up its mind – it has already stated that: “customers/their appointed advisers are responsible for the suitability assessment and selection of the investments held in the policy”. So who is the customer? The victim or the trustee? And whom did the adviser advise – the customer or the trustee? Or OMI?

OMI goes on to refer to term 11.4 of the policy which confirms that it may allow investment into professional or experienced investor funds because it owns the investments held within the EEIB, rather than the policyholder.

So, who gave the advice and to whom? OMI can’t seem to make up its mind who the customer is: the victim; the trustee or OMI itself. If OMI is the customer, why is it charging the victim fees?

OMI goes on to quote policy term 11.4.1 – which apparently clearly highlights that professional-investor-only funds carry a high degree of risk. So who is taking the risk? The victim, the trustee or OMI?

Let us ask ourselves, where did the original funds come from? Not the trustee; not OMI; but the victim.

OMI then procedes to claim that it will “only accept applications via regulated financial advisers”. But Inter-Alliance was not licensed to provide investment advice – or indeed insurance advice. CWM was not licensed either. So why did OMI accept applications from unlicensed advisors (who were also known scammers)? Also, OMI failed to identify that tied (insurance) agents are illegal in Spain – so it shouldn’t have been dealing with them at all – let alone paying them huge commissions.

OMI states that CWM was a member of Inter-Alliance WorldNet, and obtained their authorization to act via that membership. But this is not true – Inter-Alliance was not licensed and therefore neither was CWM. The application form may, in some cases, have confirmed the appointment of CWM as investment adviser with full discretion – but why didn’t OMI check that CWM was licensed? In fact, most of the victims were under the impression that they would be consulted on the investments and that their risk tolerance would be respected – but this never happened in any of the cases.

OMI goes on to claim that CWM was able to submit investment instructions directly to OMI, without consulting the trustees. But that isn’t true either: dealing instructions were sent to the trustees first, and then the trustees sent on new instructions. How can OMI not even know how its own internal systems work?

OMI concludes that it is sorry the complaining investor is “disappointed with the performance of some of the investments selected by CWM” and then goes on to claim the investments “met the criteria for a permitted asset under the EEIB policy terms”.

So who at OMI was responsible for writing and updating EEIB policy terms? Did this person not notice the losses repeatedly decimating the funds? Did this person not see the same investment failures repeating in 2010, 2011, 2012, 2013, 2014, 2015, 2016 and 2017? Did this person not question whether the policy terms ought to be revised somewhat? The answer to these questions is, inevitably, a resounding and disgraceful “NO”.

OMI is now refusing to refund or waive early withdrawal charges on the basis that CWM was an appointed investment adviser. This is because OMI initially paid a big chunk of commission to CWM – an unlicensed adviser and known scammer. If a victim wants to get out of the toxic, pointless insurance wrapper, in order to put a stop to the exorbitant fees taken quarterly out of the fund – and based on the original value rather than the decimated value of the fund – he basically has to refund the commission OMI paid to the scammers.

The victims remain dissatisfied with OMI’s response, and the complaint is now being referred to the Irish Financial Services and Pensions Ombudsman. OMI has deliberately misunderstood and overlooked every aspect of the victims’ complaints and failed to address even the most basic issues surrounding OMI’s failures and negligence.

OMI has facilitated financial crime over a period of many years; stood by while innocent victims’ retirement savings were destroyed; paid huge commissions to an unlicensed (and illegal in Spain) firm of scammers; continued charging crippling fees while victims’ funds dwindled away; extorted early exit penalties from victims unfairly and unreasonably; failed to take any action to stem the torrent of huge losses of millions of pounds’ worth of retirement savings for many years. And now it is failing to uphold the victims’ complaints.
February 22, 2018
Top 10 Deadliest Pension Scammers

Pension scammers are hidden all around us, often dressed in smart clothes, driving smart cars and carrying impressive leather folders. They offer what seems like smart investments, push through your pension fund transfer swiftly and seamlessly. However what you don´t see on the surface is their hidden parasitic ways. These scammers will drain the funds from your pension, investing in high-risk, toxic investments, that only they will profit from.

Here´s Pension Life´s, “Top 10 Pension Scammers”. (Please note: this information is correct as of the today´s date only, as pension scammers are evolving daily and as one falls another will rise!)

10 – Square Mile International

John (Gus) Ferguson’s firm Square Mile International promote unregulated toxic crap to pension savers and employs unqualified David Vilka. The so-called “advisers” promoted the Blackmore Global Fund.

It is still unclear what has actually happened to the money invested into the Blackmore Global Fund.

9 – James Lau & Tudor Capital Management

James Lau was a financial adviser with Wightman, Fletcher McCabe (FSA regulated) – part of the Clarkson Hill Group. Along with directors Peter Bradley and Andrew Meeson, of Tudor Capital Management (subsequently jailed for eight years for money laundering and tax fraud), James Lau conned 116 victims into transferring their pensions, investing in forex trading companies, and liberating up to 85% of their pensions. Lau is now rumoured to be in hiding in Hong Kong. The victims are now facing 55% tax charges by HMRC.

8 – Friendly Pensions

David Austen of Friendly Pensions, used cold-calling and high-pressure sales tactics to strong-arm 245 victims into investing in 11 fake schemes, including a truffle farm.

Dalton, Barratt and Hanson all served as trustees on the fake schemes set up by Austin – who is described as the mastermind – and were paid more than £550,000 between them. The four scammers who conned pension savers out of £13.7 million have now been banned from the industry but not imprisoned. The victims, however, lost everything.

7 – Continental Wealth Management (CWM)

One thousand people were relieved of up to £100 million worth of pension funds. Conned by a motley assortment of snake oil salesmen, the victims were promised high returns, but all they got was high losses. Old Mutual International (OMI) were the provider for the bulk of the insurance bonds in this scam. Funds were invested in risky, toxic structured notes which were clearly labelled as “for professional investors only”. Clients were lied to, as when they saw the value of their funds plunging dramatically, the Continental Wealth Management scammers assured the victims that the reported losses were “only paper losses”. Continental Wealth Management collapsed in September 2017.

6 -XXXX XXXX

XXXX XXXX was the “distributor” of the Capita Oak, Henley, Westminster and various SIPPS scams in 2012/13. He was also operating pension liberation fraud with his “loan” company: Thurlstone. When these schemes collapsed in 2013, he went on to launch an investment scam called Trafalgar Multi Asset Fund. Capita Oak, Henley, Westminster and Trafalgar Multi Asset Fund are now all under investigation by the Serious Fraud Office. XXXX XXXX has been arrested and his offices searched.

5 – Nunn and McCreesh

Phillip Nunn – along with his sidekick and partner in crime Patrick McCreesh – provided “lead generation” services to the Capita Oak and Henley scams. At up to 200 leads a month for more than two years, he was responsible for the destruction of £ millions of pension funds – and got paid nearly £1 million in fees for doing so. He then went on to set up an investment scam called Blackmore Global – a UCIS which is illegal to be promoted to retail pension savers. It is not known whether the investors have lost some, most or all of the funds in Blackmore Global as Phillip Nunn refuses to have an independent audit carried out on the fund.

4 – Steve Pimlott – Windsor Pensions

Steve Pimlott has been running Windsor Pensions for at least seven years. He claims to have done around 5,000 pension liberations and assures victims that HMRC will be “unlikely” to catch up with them. Pimlott uses QROPS schemes such as Danica in Sweden and then sets up a fraudulent bank account in the Isle of Man. The transfer never goes anywhere near Danica, of course. But the transfer is sent to the IoM bank account – 85% is paid out to the victim and Pimlott trousers the other 15%. HMRC is now taxing the victims at 55% – although they have never taken action against Pimlott who is still operating happily in Florida (not far from where Stephen Ward has his six luxury villas).

3 – Fast Pensions

Peter Moat and his wife Sara Moat were chums of Stephen Ward of Premier Pension Solutions. They ran a loan company called Blu Debt Management and also had several other businesses involving estate agency and pension administration. Hundreds of victims were transferred into the Moats’ Fast Pension schemes, and now the victims cannot access their pensions or transfer out. Peter and Sara Moat live in the Javea area of the Spanish Costa Blanca and have had 18 Pensions Ombudsman’s determinations against them for mal-administration of the pension schemes they are running. It is thought that around 400 victims are affected, although it is not known how much they have lost between them. It is known that several years ago, a substantial amount of the funds were loaned to Bridgebank Capital and then used as bridging loans for property developers. But the money has since been repaid and goodness only knows where it is now. Certainly not accessible to the members.

2 – Stephen Ward

Ark: 486 victims; £27 million at risk; 55% tax penalties on 50% loans

Evergreen: 300 victims; £10 million at risk

Capita Oak: 300 victims; £10 million at risk; tax penalties on XXXX XXXX’s Thurlstone “loans”

Westminster: 200 victims; £7 million at risk; tax penalties on “loans”

Southlands, Headforte, Feldspar, Hammerley, Maribel, Dorrixo Alliance, Halkin, Bollington Wood, Randwick Estates, Elysian Fuels, London Quantum – and many more. Stephen Ward remains active with DB transfers.

and in first position we have …..

1 – HMRC

Yes, you read correctly, HMRC is our number-one culprit in the Top 10 pension scammers list. And here’s why:

Since at least 2010, pension scams have been on the rise. That’s 8 years, yet regulations have not been changed, HMRC has not become vigilant or conscientious about registering pension scams, and new laws have not been put in place to stop scammers.

In fact, the scams are registered in the first place by HMRC, and in the case of occupational schemes also by tPR.

No notice is taken of whether the schemes are registered by known scammers and no questions are asked as to the purpose of the schemes.

In the case of James Lau’s Salmon Enterprises, the trustees – Meeson and Bradley – had been investigated by HMRC and arrested in March 2010 on suspicion of money laundering and tax fraud. However, HMRC did nothing to warn ceding providers or the public and Salmon Enterprises was left as an HMRC-registered, fully-operational occupational scheme.

Later that year, one ceding provider queried the legitimacy of the Salmon Enterprises scheme, but HMRC refused to elaborate on why the trustees had been arrested. A transfer went ahead – along with 115 others – while HMRC sat back in the full knowledge that all these victims would be bound to face unauthorised payment tax charges.

In the Ark case, HMRC spoke to the organisers and promoters (including Stephen Ward) of the six Ark schemes on several occasions. They then had a meeting with Craig Tweedley and Ward in February 2011 to discuss their concerns that the 50% “loans” paid out to scheme members constituted unauthorised payments. At this point there was a “mere” £7 million worth of transfers. Nothing was done to suspend the Ark schemes for another three months – during which time a further £20 million was transferred in. HMRC is now trying to tax both the members and the scheme for unauthorised payments.

In the full knowledge that Stephen Ward was behind Ark and numerous other scams, HMRC ignored evidence of his pension trustee/administrator firm – Dorrixo Alliance. In May 2014, they discussed prosecuting Ward, but did nothing about the London Quantum pension scam, and in August of the same year, a police officer lost his police pension to Ward’s scheme.

Therefore, HMRC takes 1st place, due to its downright lack of motivation to help stop the scams, yet speedy tax demands fly out for the unauthorised payments arising from the so-called “loans” operated from the very schemes that HMRC themselves registers.

Furthermore, HMRC taxes the victims of pension liberation scams – and not the perpetrators.

List of 10 deadliest parasites borrowed from listverse website for comparison.

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As always, Pension Life would like to remind you that if you are planning to transfer any pension funds, make sure that you are transferring into a legitimate scheme. To find out how to avoid being scammed, please see our blog:

What is a pension scam?

Follow Pension Life on twitter to keep up with all things pension related, good and bad.

February 18, 2018
Say NO to structured notes for pensions!

Structured notes – say NO to them if an adviser wants to invest your pension in them. They are high-risk investments which are for professional investors ONLY – and not for ordinary retail investors – especially pensions.

Say NO to structured notes for pensions!

Structured notes have been used as pension investments for some years. Many advisers don’t understand them – and certainly, no retail pension investors understand them either. Structured notes are definitely not the low risk, high return investments originally promised – and the capital is NOT protected as claimed by some advisers.

As in the above example, it is a disgrace that structured note providers such as Commerzbank, Nomura, RBC and Leonteq have allowed their toxic products to be used for retail pension savers. Even when these rotten products have nosedived repeatedly, these dishonest and dishonourable providers keep on flogging them to destroy victims’ retirement savings.

Along with the rogue advisers – such as the scammers from Holborn Assets and Continental Wealth Management – and the rogue structured note providers, there are also rogue insurance companies who accept these toxic, high-risk, professional-investor-only investments. These insurers know full well that accepting these notes will doom the policyholders to poverty in retirement, but they don’t care. Some of the worst of these “life offices” are Old Mutual International, SEB, and Generali. These companies are no better than scammers and really should be called “death offices” since they effectively kill off thousands of victims’ life savings with their extortionate charges.

Commerzbank, Nomura, RBC and Leonteq all claim to be “award winning and innovative companies” and yet they show zero compassion to the victims who lose huge proportions of their retirement savings. The structured note providers keep paying commissions to the scammers – ranging from 6% to 8% of the investments. And then, when the structured notes go belly up, they simply sell more of the same toxic rubbish to the same scammers in an attempt to further ruin the victims.

So what the hell are structured notes? And why should investors say NO to them?

A structured note is an IOU from an investment bank that uses derivatives to create exposure to one or more investments. For example, you can have a structured note betting on the S&P 500 Price Index, the Emerging Market Price Index, or both. The combinations are almost limitless.

Say NO to structured notes for pensions!

Structured notes are frequently peddled by less-scrupulous financial advisers – as well as outright scammers – as a “high-yield, low-risk” supposedly backdoor way to own stocks. However, regulators have warned that investors can get burned – which they frequently do. If the investment banks can flog it, they will make just about any toxic cocktail you can dream up. In reality, a structured note is an unsecured debt issued by a bank or brokerage firm – and the amount of money the investor might (or might not) get back is pegged to the performance of stocks or broad market indexes.

Read more: Structured Notes: Buyer Beware!

On the surface, the ‘cocktails’ the structured note providers make seems like they could generate a great return. However, the truth is they often benefit the financial adviser rather than the investors.

Structured notes are suitable for professional investors only – and the fact sheets issued by the providers state this clearly. Whilst they do offer high returns if successful, they are also high risk with no protection on the amount invested. Structured notes should not be used for pensions.

Continental Wealth Management(CWM) invested over a thousand low to medium risk clients’ retirement savings in structured notes – mostly provided by Commerzbank, Nomura, RBC and Leonteq. These clients now have seriously decimated funds and are worried sick. But Commerzbank, Nomura, RBC and Leonteq have shown neither remorse for their toxic, high-risk, illiquid products nor concern for the hundreds of victims.

OMI (Quilter), Generali and SEB have also been totally disinterested in the thousands of failed structured notes they have facilitated. Indeed they are even charging the victims crippling early exit penalties when they decide to get out of the expensive and pointless insurance bonds which are further eating into the remaining funds.

Most structures notes have no guarantee, so their worth often depreciates to less than the paper they are printed on. Much like a bet at the races, if you bet £10 on Noble Nag to win in the 2.30 at Kempton Park at ten to one, you are guaranteed to win £100 if the horse wins. But if the horse doesn’t win, you say goodbye to your money.

Most structured notes are dressed up to look appealing to the uninformed victim. But in reality they are high risk and illiquid and can result in total decimation of a victim’s life savings. The advisors rarely disclose the commissions they are earning from the purchase of the structured notes (or from the insurance bond). Plus, once the structured notes start showing a serious loss, the adviser just dismisses this as “only a paper loss”. As the advisors have already taken their cut, they are rarely bothered if this high-risk investment does lose the client money.

So if you hear the term ‘structured note’ in connection with your retirement fund, just say ‘NO’. The only people profiting from this type of investment are the advisers.

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As always, Pension Life would like to remind you that if you are planning to transfer any pension funds, make sure that you are transferring into a legitimate scheme. To find out how to avoid being scammed, please see our blog:

What is a pension scam?

Follow Pension Life on twitter to keep up with all things pension related, good and bad.

January 27, 2018
QUILTER – A NEW HOBBY FOR OMI?

Quilter – Old Mutual International – new name to try to hide past crimes

QUILTER – A NEW HOBBY FOR OMI? OMI – Old Mutual International – needs to compensate thousands of victims of financial crime which they facilitated. I can’t make up my mind whether they are adopting the brand “Quilter” to attempt to shake off their sordid and toxic past, or whether they are actually taking up quilting.

If OMI really is going to become a quilter, it needs to make a quilt depicting all the criminals whose crimes it has facilitated for so many years. And all the victims who have lost part of or all of their life savings.

What OMI really needs to do is to get firmly behind the prosecution of the criminals – from whom they profited for many years. OMI must contribute to the cost of denouncing these criminals and ensuring they are given maximum prison sentences.

Also, OMI – Old Mutual – must stop allowing toxic, professional-investor-0nly structured notes in their bonds. Typically, these were provided by Commerzbank, Nomura, Leonteq and RBC. If Old Mutual International wants to gamble away its own money on these crap products, then be my guest. But don’t expose retail pension savers to these sordid, high-risk instruments – used by the scammers as mere tiles in a game of Scrabble.

Thanks to IFA Al Rush, there is now a criminal investigation into the hordes of vultures who preyed on the British Steelworkers. This has been eloquently reported by Henry Tapper in his blog about the police investigation at Port Talbot.

Al Rush championing the British Steelworkers who have been scammed

Al Rush has suggested the wording which victims can use to report those who scammed – or attempted to scam – them. And all of what Al and his colleagues have done has been done at their own expense and out of a sense of decency.

Hard to tell the difference between OMI and Quilter and Jabba The Hut

This is in stark and stinky contrast to OMI – Old Mutual International. Since 2011, OMI has sat and watched – like a cross between Jabba The Hut and a Black Widow Spider – while thousands of victims have seen their life savings dwindle away to very little or even nothing. And all the while, taking extortionate fees and paying commissions to the very scammers who ruined the victims in the first place.

So does OMI really think that adopting the name “Quilter” will make future victims fail to make the connection – that this is the same firm that took business from dozens of unregulated scammers such as Continental Wealth Management, Abbey Financial Solutions, Holborn Assets, Guardian Wealth Management, and other “chiringuitos”?

Perhaps the worst crime committed by OMI is not that they took business from unlicensed scammers; not that they allowed 100% of victims’ pension funds to be invested in professional-investor-only, high-risk structured notes; not that they sat there idly and negligently while the clients’ pensions and investments shrank inexorably……

Old Mutual International – the rubbish end of financial services

the worst of OMI’s crimes has been that when there are only a few crumbs left of a life-time’s retirement savings, they will still charge crippling early-exit penalties. OMI, or Skandia, or Quilter or Jabba The Hut or whatever the hell this toxic, evil shower call themselves, have no place in financial services. They have facilitated and profited from financial crime for years and benefited from the misery and ruin of thousands of victims.

In an attempt to emulate Al Rush’s suggested police report for British Steel victims at the hands of the various scammers who targeted, stalked and scammed them, here is my suggested report for OMI victims to make to the police and the regulators. Naturally, this will work equally well for victims of Generali, SEB, RL360, Friends Provident, Hansard, Investors Trust etc.

OMI must be sanctioned for facilitating financial crime

‘I was advised to transfer out of my personal/occupational (delete as appropriate) pension scheme and was lied to when I asked about how much money would be taken from me. I think, over time especially, I will lose/have already lost many tens of thousands of pounds (probably, hundreds of thousands of pounds) in fees which were hidden from me.

This will bleed my pot dry, leave me exposed to poverty in old age and create a burden on the local council.

I was specifically told there would be no penalties or lock-in periods.

Can you help me please, I would like to make a formal statement and help you bring charges against those who did this, and those who helped them’.

January 20, 2018
OMI? OMG! SAME OLD, SAME OLD MUTUAL – SAME OLD LIES
Old Mutual International (OMI) is at the heart of much of what is wrong with offshore financial services. The CWM debacle clearly evidences this.

OMI, formerly Skandia and soon to be Quilter, provided the vehicle used to wipe out thousands of victims’ life savings – not only in the CWM scam, but also with many other rogue financial advisers (often referred to by the Spanish regulator as “chiringuitos”).

OMI (Old Mutual International) is used as a bogus life assurance policy to “wrap” dodgy investments which subsequently nose dive and destroy portfolios.

The so-called “life wrapper” serves absolutely no purpose from the investors’ point of view, other than to pay exorbitant fees to OMI and the adviser (which is often not licensed to provide either insurance or investment advice). These fees, of course, mean that the victims’ pensions and investments never have a hope in hell of growing – or even maintaining their original value.

High-risk, illiquid, professional-investor-only structured notes bought with the victims’ retirement savings by rogue advisers (such as Continental Wealth Management – CWM) frequently fail – and sometimes are even fraudulent – so bring victims’ funds crashing down even further. In the case of the CWM debacle, the structured notes were mostly Commerzbank, Nomura, RBC and Leonteq, and many of the notes crashed – costing the victims millions of pounds.

OMI charged the victims the following fees:
- Regular Management Charge 1.15% for ten (yes – TEN!) years
- Admin Charge Eur 144.00 annually
- Early Surrender Charge 11.5% – reducing by 1.15% a year to nil after ten years
But did OMI do any actual “management”? No. They never monitored the losses, alerted the investors or offered to do anything to help stem the hemorrhaging of victims’ funds. OMI just sat there like a lazy, greedy, callous parasite and watched the victims’ retirement savings dwindle. OMI must have known that this would be condemning thousands of people to poverty in retirement and yet they obviously did not care two hoots.

Did they do any actual “admin”? Yes. They reported the losses and ever-shrinking funds. But they took no action to help the thousands of victims or prevent further losses.

Was it reasonable to tie victims into a useless, pointless insurance bond for ten years? After all, the bond clearly offered no protection or guarantee of the capital invested. And was it right to charge 11.5% for the privilege of losing huge proportions of the funds? No, absolutely not. In law, a pension scheme member has a right to transfer and needs the flexibility to alter their pension arrangements whenever they need to. Being tied into a useless and expensive insurance bond FOR TEN YEARS is the last thing a retirement saver needs.

In the wake of this appalling tragedy, what has OMI done to put things right?

Has OMI offered to pay compensation to the victims?

NOPE

Has OMI offered to rebate its (extortionate) charges?

NOPE

Has OMI offered to waive the punitive exit fees for those who want to try to rescue what’s left?

NOPE

Has OMI lowered the 25% barrier so that ruined and desperate victims can access some income to avoid starving to death?

NOPE

Has OMI learned anything whatsoever from the CWM debacle? Has it turned over a new leaf and stopped accepting business from unlicensed scammers such as CWM? Has it stopped making exorbitant charges which drag retirement savings down? Has it stopped paying huge commissions to scammers to encourage them to destroy thousands of victims life savings? Has it stopped allowing and promoting toxic structured notes?

The answer to all of the above is a resounding NO. OMI knew exactly what terrible fate it was condemning the victims to for the past seven years.

OMI knew that the victims could face losing significant parts of their retirement savings – and stood by while it happened. Well, not exactly just stood by – they made huge profits in the process.

Has OMI learned anything from this tragedy? Has it turned over a new leaf? Absolutely not. In November 2017, it was still offering – and even aggressively pushing – structured notes to financial advisers and offering meaty commissions – obviously trying to replicate the huge success it made out of the Continental Wealth Management scam. On 30th November 2017, OMI sent out a bulk email to advisers:

From: Old Mutual International mail: intmarketing@engage.omwealth.com]

Dear Greedy Broker, HURRY HURRY HURRY! SPECIAL OFFER ON STRUCTURED NOTES TO FLOG TO UNSUSPECTING VICTIMS. GET YOUR RUNNING SHOES ON – THIS OFFER CLOSES 15TH DECEMBER 2017. WE NEED MORE UNSUSPECTING MUGS LIKE THE CWM VICTIMS SO WE CAN MAKE MORE HUGE PROFITS AND CONDEMN MORE PEOPLE TO POVERTY IN RETIREMENT.

“The latest, tranche of structured products provided by BNP Paribas is available now through our portfolio bonds. But you don’t have long to get business in – this tranche will now close on 15th December 2017.

The products on offer during this tranche are:

Global Equity Income 5 – with a five year term paying quarterly income of 6% a year in USD or 5% a year in GBP – capital at risk product

Global Equity Autocall 9 – autocall product with a six year term paying 10% a year in USD or 8.25% a year in GBP – capital at risk product

Multi-Asset Diversified Global Certificate 10 – with a five year term and 100% capital protection

Full details, including how to access the products, are on our dedicated structured products page.”

Notes pay initial commission of 5.88% to Old Mutual of which 4.69% is paid to the adviser. OMI pockets 1.19%. No wonder OMI are pushing this!

The BNP Paribas “handbook” spouts the same old same old rubbish that CWM was using to con around 1,000 victims out of their retirement savings between 2011 and 2017:

“Structured Products are investments that are fully
customised to meet specific objectives such as capital
protection, diversification, yield enhancement, leverage,
regular income, tax/regulation optimisation and
access to non-traditional asset classes, amongst others.
The strength of a Structured Product lies in its
flexibility and tailored investment approach.
In their simplest form, Structured Products offer
investors full or partial capital protection coupled
with an equity-linked performance and a variable
degree of leverage. They are commonly used as a
portfolio enhancement tool to increase returns
while limiting the risk of loss of capital.”

The hundreds of CWM victims know that this is all lies: with structured notes, there is no capital protection; no flexibility; no portfolio enhancement; no increased returns and no limit to the risk of loss of capital. Shame on BNP Paribas for helping OMI to dupe more victims into losing their retirement savings and facing financial ruin.

So, the message to the public is:

DON’T TOUCH OMI – OLD MUTUAL INTERNATIONAL – WITH A BARGEPOLE

DON’T TOUCH STRUCTURED NOTES IN GENERAL WITH A BARGEPOLE

DON’T TOUCH STRUCTURED NOTES BY BNP PARIBAS WITH A BARGEPOLE

DON’T BELIEVE THE LIES TOLD BY ROGUE FINANCIAL ADVISERS, OMI OR BNP PARIBAS

DON’T BECOME ANOTHER VICTIM OF THE INSURANCE BOND/STRUCTURED NOTE SCAM

Lastly, OMI’s self-congratulating rubbish on their website crows about their “customer principles” and the many awards they have won. An example of this is the following statement:

Giving good service to financial advisers and their clients is at the heart of our business. We work hard to constantly improve our standards in this area. Our track record speaks for itself.

And yes, OMI’s track record does speak for itself – and anyone who does even the most basic maths will inevitably say “Oh My God!”.

And BNP Paribas’ claim that “a Structured Product lies” sums it all up nicely.
January 7, 2018