Tag: Peter Kenny

2021/22 Roundup for Pension Life

2021 was a tough year for everybody in the world. But for Pension Life it was especially frustrating because courts and law firms were severely held up as they got to grips with the challenges of Covid, travel restrictions and working remotely.

Attending hearings and meetings by video conference was a hit-or-miss affair. The success of the communication depended on the reliability of the wifi, the quality of the microphone and camera, the ability of the participants to manage (often complex) IT issues.

Holding virtual meetings with lawyers working from home often became challenging when interrupted by small children or pets (or partners in the background nipping to the bathroom wearing only a towel).

The term “beware of the dog” took on a whole new meaning – as well as extending to the cat and budgie. Conversations became disrupted by all sorts of background sounds, and it was frequently possible to miss important bits of a conversation because of noise pollution. This was made even more challenging when trying to work in Spanish and wearing a mask and glasses.

But still the essential task of working towards pursuing those who carried out or facilitated the scams and preparing claims for victims of pension scams continued. Albeit more slowly and haltingly than normal.

So, here is a brief round-up of the main developments for Pension Life from 2021 and the plans for 2022.

Ark – Tax Tribunal trial for pension scam victims

Judge Peter Kempster

After a frustrating ten-year wait, the pre-trial conference took place with Judge Kempster and all the parties involved in the Ark Tax Tribunal trial. With desperate attempts by HMRC to put the trial off until the end of 2023, the trial date was finally – thankfully – set for December 2022.

There are more than half a dozen different categories of appellant; member who did receive a loan; member who didn’t receive a loan; member who did make a loan; member who didn’t make a loan; member who paid their loan back; member who paid the tax on the loan…….

Most of the appellants have dropped out of the trial for one reason or another. I think the reality of actually appearing in court and being subjected to HMRC’s barrister’s inevitably hostile cross examination may have finally sunk in for some people. We are now down to just two appellants – one represented by me and one by Rebecca Sheldon from Old Square Tax Chambers. Essentially, this will be a contest about who is going to have to pay the tax: those with a loan or those without a loan.

The next eleven months will see an increasingly urgent series of communications between the court, the appellants and their representatives. In the background, there are now two separate All Party Parliamentary Groups trying to lobby parliament for an amnesty for victims of pension and investment fraud who are facing tax penalties.

Also, the FCA has asked pension scam victims to submit evidence following an investigation into the activities of Premier Pension Solutions, AES Financial Services and International Pension Transfer Specialists (all involving Stephen Ward and Sam Instone).

Capita Oak – Tax liabilities and recovery of Store First assets

Stephen Ward of Premier Pension Solutions with his mythical employer

Capita Oak was a bogus “occupational” pension scheme set up with a mythical employer in Cyprus by Stephen Ward of Premier Pension Solutions and his pensions lawyer Alan Fowler. The scheme remains in the hands of Dalriada Trustees (appointed by the Pensions Regulator).

With £10 million of the 300 members’ funds invested solely in Store First, and “loans” paid out by a Gibraltar company called Thurlestone, the victims remain trapped and unable to withdraw their tax-free 25% lump sums, or access a retirement income.

Dalriada had rejected an offer to sell the store pods back to Store First several years ago. There may be another offer this year – although it is unlikely to be as high as the one Dalriada previously turned down. Sadly, whatever offer is made and accepted, a large chunk of this money would be used up in paying trustees’ and other fees (such as legal costs).

There had been a large crew of scammers behind the Capita Oak scheme – as well as the parallel Henley and Westminster schemes. Two significant figures among those who operated and distributed these scams were Phillip Nunn and Patrick McCreesh.

Despite the Insolvency Service carrying out a comprehensive investigation into these cases, Nunn and McCreesh were not sanctioned by either the Insolvency Service or the FCA for carrying out regulated activities illegally. Nunn & McCreesh went on, in 2014, to set up the Blackmore Group and launched the Blackmore mini bond which was promoted by Surge Group (which also promoted the London Capital & Finance mini bond which is now being wound up by Duff & Phelps).

Nunn and McCreesh also issued the Blackmore Global investment fund which is now reported to be worthless. The destruction of the original value of the fund is believed to be due to investing in over-priced, speculative property. Any remaining value was extinguished by paying out hefty commissions to the introducers and “advisers” who promoted the fund.

Adams v Carey

In 2021, the Appeal Court ordered the SIPP provider Carey (now Options and owned by STM) to reinstate appellant Russell Adams’ pension. Adams had been “advised” by unlicensed scammer Terence Wright of Country Land and Property in Spain. The advice had been to transfer his pension into a Carey SIPPS and invest all of it into Store First.

The Appeal Court decided that Carey should have rejected the advice as there had been an FCA warning about Terence Wright. However, Christine Hallett – CEO of Carey – deliberately ignored this warning and accepted Wright’s instructions to invest not just Mr. Adams’ pension in Store First, but also hundreds of others.

At one point, Hallett finally realised that she had been wrongly accepting pension transfers from Terence Wright, refused to accept more transfers, but continued to act on Terence Wright’s investment instructions and invested £millions more in Store First.

The Appeal Court determination has set a powerful precedent for hundreds more victims to take similar action to have their original pensions reinstated. Ironically, the Store First store pods are now doing well and more storage facilities are going to be built. However, the fact remains that store pods are not suitable assets for a pension, as they are illiquid and – as Justice Andrews ruled – they are “hard to value”.

Acquisition of Quilter by Utmost

In 2020, RL360 acquired Friends Provident International. And late in 2021, Utmost (formerly Generali) acquired Quilter (formerly Old Mutual International). So, as hundreds of millions of pounds have changed hands across these two buyouts, deceased victims of fraud facilitated by these four death offices will inevitably turn in their graves.

Former CEO of Quilter, Peter Kenny, has moved on to even greener pastures as he “pursues different opportunities”. Kenny, who – in 2018 – promised to pay compensation to some of the victims (two of whom have since died), will have done very nicely out of the Utmost acquisition.

As a former regulator, Kenny should certainly have known better than to do business with the hordes of unlicensed scammers. Who knows – perhaps he will use his ill-gotten gains to set up a charity for death office victims in 2022….

GFS – Hong Kong QROPS gone bad

In 2022, the pension-scam focus will drift as far offshore as Hong Kong. Bogus occupational schemes had originally been the speciality of Stephen Ward (Ark, Capita Oak, Westminster, Henley, London Quantum etc). But, in 2014, a group of scammers set their sights on a bogus superannuation scheme in Hong Kong.

In the UK, anyone with any kind of earnings can join an occupational pension scheme. A person does not need to be employed by the sponsoring employer – as determined by Justice Morgan in the Hughes v Royal London case. This does, of course, sound completely barmy and opens the doors wide for all sorts of scams and scammers.

However, in Hong Kong, a person can only – by law – join an occupational (superannuation) pension scheme if they are genuinely employed by the sponsoring (principal) employer.

In 2014, a group of scammers got together. This included John Ferguson, David Vilka and Charlie Goldsmith of the Square Mile group, and Phillip Nunn and Patrick McCreesh of Blackmore Group.

David Vilka (right) & John Ferguson (left) of Square Mile

Hundreds of mainly UK-based pension holders were conned into transferring their pensions into the GFS QROPS in Hong Kong. The money was then invested in toxic UCIS funds and unregulated mini bonds. Of course, none of these British victims was employed by the employer.

The investments included Blackmore Global, Christianson Property Capital, Swan, GRRE and other investment scams. In total at least £27 million was invested – some of it in insurance bonds such as Quilter, Utmost, Hansard and Friends Provident. An attempt was made to transfer some of the funds into Gravitas bonds (a death office in Mauritius), but this was thwarted in 2015 when a new trustee took over.

In 2022, the Hong Kong version of the Pensions Regulator (the MPFA) will be deregistering the GFS scheme and a liquidator will be appointed. The liquidator will need a robust shovel to dig through all the toxic rubbish assets and recover several million pounds’ worth of stolen cash.

The good news for some of the members, however, is that Square Mile is now in liquidation. This means that there is a valid claim on the Financial Services Compensation Scheme of up to £85,000 per victim.

FSCS claims will be made for qualifying GFS members early in 2022 and hopefully this will result in at least some victims getting part or all of their pensions back.

CWM Criminal Trial – awaiting court’s decision

The trial against the members of Dénia-based Continental Wealth Management finally concluded in December 2021. The criminal proceedings had been held up for a year due to COVID. But finally, the last of the defendants testified before the judge and procurador. These included Darren Kirby and his girlfriend Jody Smart (formerly Bell, Kirby and now Pearson). While Jody did appear and testify in court, her former boyfriend Darren Kirby remains on the run.

“Advisers” Dean Stogsdill, Neil Hathaway and Anthony Downs also appeared – along with Darren Kirby’s original partner and co-founder Paul Clarke. Clarke had left CWM early on to run AES Spain for Sam Instone – and continued to operate Darren Kirby’s business model by scamming victims into illegally-sold death bonds and structured notes. Clarke now runs a new firm called Roebuck Wealth under the German license of Trafalgar International.

In December, the last of the victims appeared in the Dénia court to testify. The judge has now heard 17 victims’ testimonies, and seen the documentary evidence of the investment scams operated by the various members of the CWM team – headed up by company director Jody Smart/Bell/Kirby/Pearson. One victim passed away in early 2021, so the re-starting of the criminal proceedings sadly came too late for him.

Also in 2021, Jody denounced me for sharing a photograph of her dressed as a prostitute. I did indeed share the photo – as did hundreds of other CWM victims as it was all over social media. Everyone who saw this revolting picture felt and expressed the same disgust. It became ever more astonishing that Quilter, Utmost and SEB had been accepting investment instructions from this woman’s firm.

The judge dismissed the accusation against me. The photo is now irreversibly in the public domain. (It was so graphic that it can unfortunately never be “unseen” – and would put even a rhinoceros off its lunch).

This will, hopefully, encourage death offices such as Quilter, Utmost, RL360 and Friends Provident, to be a bit more discerning in 2022 about the parties to whom they give terms of business and from whom they accept investment dealing instructions.

Malta Arbiter Appeals – Civil Court upholds most of the Arbiter’s determinations

Since 2017, around 70 victims of pension scams complained to the Malta Arbiter. The complaints were that QROPS trustees had accepted transfers and investment instructions from unlicensed and unqualified advisers. Many of the complainants reported that their pension funds were placed into insurance bonds and then invested in high-risk investments which were only suitable for professional investors.

These investments – many of them toxic structured notes from providers such as Commerzbank, Leonteq, Royal Bank of Canada and Nomura – were placed on the insurance bond providers’ platforms. From here, the scammers who had terms of business with these providers could pick and choose the highest-risk investments which paid them the most commissions. These providers included Quilter (formerly Old Mutual – recently taken over by Utmost/Generali), Utmost and SEB.

Millions of pounds’ worth of pensions were destroyed in the past decade. The Arbiter upheld most of the complaints against the QROPS trustees, but only awarded the complainants 70% of their net investment losses. This was on the basis that the defendants were only partly responsible, and that the advisers as well as the insurance bond providers were also culpable – and contributed to the losses.

The defendants appealed against the Arbiter’s decisions. In late 2021, the first civil court decisions were issued – dismissing the defendants’ appeals. The rest of the appeal decisions are expected during 2022 and are expected to uphold the Arbiter’s decisions.

Civil Cases against life offices in Spain

A determination obtained from the Spanish insurance regulator confirms that virtually all insurance bonds are sold illegally by the scammers who peddle them across the Iberian peninsula and the Balearics. This is because there are very specific regulations which must be observed when advising on any insurance products – and the scammers operating in Spain routinely ignore these.

Spanish legal experts advise that insurance bond providers have indeed facilitated fraud, abusive practices and contravention of EU and Spanish laws and regulations. There are therefore strong cases against the insurers which will be pursued during 2022 – with the first claims due to be issued during the first quarter of the year.

Obviously, the strength of the civil cases against the insurance companies will be reinforced once the criminal court issues their determination in the CWM case.

The civil claims will be seeking rescission – i.e. the reversing of the single-premium payments and subsequent unlawful investments in unsuitable, high-risk investments.

Civil Cases against life offices not in Spain

While Spanish law is fairly unique, and does not resemble the laws of England, the Isle of Man, Ireland or Guernsey (where the majority of death offices are based), there are thousands of pension scam victims who are not based in Spain.

Preparations are now being made to bring civil cases against all insurance companies such as Quilter, Utmost, Friends Provident and RL360 who have facilitated fraud and mis-selling (resulting in serious loss for the victims).

There are already several groups trying to get civil litigation against these insurers off the ground. One is being brought by Signature Litigation against Quilter and Friends Provident – mainly for the investment losses caused by the failure of UCIS funds such as LM, Axiom and Premier New Earth.

The other cases are being brought by Forsters LLP. This case suffered a setback when their funder – Affiniti – went bust in November 2021 and is now being wound up by Quantuma:

Forsters’ clients have also been told they can make claims against the QROPS providers in Malta for the losses not covered by the Malta Arbiter’s awards.

Trafalgar Multi Asset Fund – Cayman Islands

The victims of the STM Fidecs/Trafalgar Multi Asset Fund pension and investment scam are now mostly out of time to bring civil claims in Gibraltar. The scammers behind the investment of the funds transferred into the STM Fidecs QROPS are now under criminal investigation by the Serious Fraud Office. Once convicted, this should help with the criminal proceedings being launched in Gibraltar – although this does not stop the criminal proceedings from going ahead anyway. As they are criminal, as opposed to civil, the time limits do not apply.

Much of the Trafalgar Multi Asset Fund was invested in the Dolphin Trust investment/loan scam – later re-named as the German Property Group. This fund was paying out huge commissions of around 19% to the scammers who introduced thousands of victims to the “loan” scheme. There is now mounting evidence that Dolphin was nothing more than a Ponzi scheme and that many of the purported property purchases were fictional.

In summary, progress this last year has indeed been slow due to the pandemic. However the legal teams and professional advisors have never slowed down in their efforts to bring redress and justice to the victims.

January 17, 2022
The Sound of Silence (and Deafening Disgrace)
This has been a week of scammers trying to silence the din of their sin.

No matter how hard they try – stealing newspapers, denying the truth on social media or taking me to court – hard evidence simply won’t go away. It is there to stay.

Costa Blanca Newspaper The Olive Press ran a story last week on Neil Hathaway of Continental Wealth Management. Hathaway – along with colleagues Anthony Downs and Dean Stogsdill – had been one of the three most senior players beneath Darren Kirby and Jody Smart in the £100 million fraud committed against 1,000 victims.

Masquerading as “financial advisers” from 2010 to 2017, Hathaway, Downs, Stogsdill and Kirby conned hundreds of pension savers into transferring their pensions offshore so that CWM could make £ millions out of concealed commissions on the insurance bonds and structured notes they used to destroy their victims’ life savings.

Operating illegally in Spain, Darren Kirby and his partner Jody Smart – sole director of the company (Continental Wealth Trust S.L. trading as Continental Wealth Management) – entrusted the dodgy trio with managing the fraudulent operation. Kirby, Smart, Hathaway, Downs and Stogsdill – along with their associates Stephen Ward of Premier Pension Solutions and Paul Clarke of Roebuck Wealth Management – are all now facing charges of fraud in the Denia court.

Neil Hathaway was caught stealing bundles of copies of The Olive Press in his black SUV. Now being investigated by the local police, he is claiming he committed the crime because he was “angry” at having been outed in a previous Olive Press article – along with Darren Kirby and Jody Smart.

Hathaway’s defence appears to be that he stole fewer copies of the Olive Press newspaper than the police say he did; that his wife had been “approached at work”; and that he was “protecting his name”.

And this is the bit that scammers never seem to understand: Neil Hathaway’s name is on thousands of documents which evidence what he did to hundreds of CWM victims. Stealing hundreds of copies of a free newspaper isn’t going to make that evidence go away.

The hundreds of emails written by Neil Hathaway conning his victims; the OMI, SEB and Generali statements and valuations reporting the huge losses suffered by his victims; the many testimonies of his distressed (and often suicidal) victims will still evidence what he did – no matter how many copies of The Olive Press he steals and destroys.

Hathaway’s former “boss” Jody Smart (aka Jody Bell, Jody Kirby or Jody Pearson) has also been exposing (and disgracing) herself this week. A collection of “artistic” photographs has been doing the rounds on social media – evidencing Jody’s talents in partnership with a somewhat bouncy buddy.

I wonder what they were promoting? It could easily have been blond hair dye or red stockings – or anything in between. But it is hoped they would both have been more transparent about what they charged for their services than the “advisers” at CWM were.

And this, of course, is a perfect illustration of why so many offshore “advisers” behave – and promote themselves – in a manner which is so misleading. They purport to be giving “advice” which will improve expats’ pension arrangements by transferring the funds offshore. But the reality is that even if their pensions should have been left where they were in the UK, their principal motivation was to earn hidden commissions out of selling insurance bonds and high-risk investments.

However hard anyone tries to remove this image of Jody Smart and her “Big’n Bouncy” associate (and other even more eye-watering images which I cannot publish because they might offend my gentle readers) from the internet, one can never un-see what has been seen. The memory of this photograph can never be extinguished – any more than the evidence of the destruction of so many of her clients’ pensions can ever be rubbed out.

The scammers at CWM are soon going to be joined by their counter parts at Spectrum IFA Group, Pennick Blackwell/AES International and Holborn Assets. This would already have happened had it not been for Covid 19 and the closure of the courts.

All these firms, and their so-called “advisers” (in reality just poorly-qualified salesmen) have several things in common:
- They all recommend pension transfers even if it is in the client’s interests to leave the pension where it is (in the UK)
- They all lie about the merits and advantages of QROPS
- They have all decided – before they know the first thing about the client – that he is going to be put into an insurance bond
- They all seek out investments which pay the highest (hidden) commissions – irrespective of whether these funds are any good (which they usually aren’t)
- They rarely have any relevant financial services qualifications
- Their firms are frequently unlicensed for insurance mediation or investment advice
- They are all committing a criminal offence every time they sell an insurance bond in Spain (and possibly other jurisdictions)
A few of the scammers are now facing criminal charges in Spain. Several scammers are under investigation by the Insolvency Service and/or the Serious Fraud Office. A couple of “life” offices are facing civil proceedings in the Isle of Man. A QROPS provider is facing civil proceedings in Gibraltar. Another QROPS provider is facing criminal proceedings in Hong Kong. A fund manager is about to face criminal proceedings in the Isle of Man. The tide is beginning to turn against the global trend of financial crime.

When all’s said and done:
- a worthless, bogus, unregulated Cayman Islands fund is a worthless, bogus, unregulated Cayman Islands fund
- a couple of tarts are a couple of tarts
- a trio of scammers are a trio of scammers.
Stealing newspapers or trying to prevent the publication of the crimes isn’t going to change any of that. The hard evidence of the crimes will remain – no matter how hard the scammers try to hide it.

It doesn’t look like Old Mutual International (or Skandia or Quilter or whatever they are calling themselves this summer) is going to be able to bottom out their “clean up” operation. Perhaps they ought to try changing their name again so people forget what they did in the past? Perhaps under CEO Peter Kenny’s watchful eye, this might be achieved?
July 12, 2020
Time for all pension providers to wake up and stop pension scams

The recent PSIG (Pension Scams Industry Group) Scams Survey Pilot 2018 has identified seven “key” findings in their survey. As scam watchers, we are well aware of these points and are, of course, glad they have been highlighted.

PSIG’s key finding are set out below. So let us admit one key fact:

ALL PENSION SCAMS START WITH A TRANSFER BY A CEDING PENSION PROVIDER.

It is interesting that PSIG chose three particular providers to give their answers to the questionnaire sent out: XPS Pensions Group, Phoenix Life Assurance Company and Standard Life Assurance Company. I have no doubt they chose these three providers because of their extensive first-hand expertise at facilitating financial crime. In the Capita Oak and Westminster scams – distributed and administered by serial scammers XXXX and Stephen Ward – and now under investigation by the Serious Fraud Office – Phoenix Life and Standard Life handed over dozens of pensions to the scammers. In Phoenix Life’s case, the total came to nearly half a million pounds’ worth, and in Standard Life’s case it was well over one million.

While there is, of course, substantial hard evidence that both the Pensions Regulator (formerly OPRA) and HMRC had been giving the industry plenty of warnings about scams long before the Scorpion Campaign was published on Valentine’s Day in 2013, it is also true that providers such as Phoenix Life, Standard Life – and other favourite financial crime facilitators such as Aegon, Friends Life, Legal & General, Prudential, Royal London, Scottish Life and Scottish Widows – carried on handing over millions to the scammers well into 2014, 2015 and beyond. And, in fact, they are still at it today.

The “Key Findings” do throw up some interesting facts:

“Information on scams is not readily available at an organisational level”.

Seriously? Don’t these organisations know how to do research? Do they really not know what to look for? They’ve had enough experience over the years – and have had enough examples of spending vast amounts of time trying to cook up reasons to deny complaints against their incompetence for handing over pensions to scammers – to write a whole encyclopedia about scams.

Organisations (such as Phoenix Life and Standard Life) could try talking to TPAS, or tPR, or the FCA, or the SFO, or Dalriada Trustees, or regulators in Malta, the IoM, Gibraltar, Dubai or Hong Kong. Or some of the thousands of victims – who have lost their pensions due to the incompetence and callousness of the ceding providers – who would readily fill in the blanks. There really is no shortage of readily-available, free information. They just need to take the time and trouble to ask for it. It really isn’t difficult. They just have to put their box-ticking pencils down for a few minutes.

“The Scams Code is seen as a good basis for due diligence”

I agree – it is really great. But it is also 78 pages long. Few people have to the time to read, understand or remember such long documents (with too many long words and not enough pictures). What would be helpful would be to get a few of the worst offenders: Aegon, Aviva, Friends Life, Legal & General, Phoenix, Prudential, Royal London, Scottish Life, Scottish Widows, Standard Life and Zurich, in a room at the same time – and bang their heads together. And threaten them that if they don’t get their acts together and stop handing over pensions to the scammers, they will be made to read and memorise the 78-page Scams Code and recite it every morning before coffee break. Twice. Then snap all their box-ticking pencils in half, and JOB DONE! It really isn’t rocket science – there are usually some hints which are as subtle as a brick, such as: the sponsoring employer doesn’t exist; or the member lives in Scunthorpe and is transferring to a scheme whose sponsoring employer is based in Cyprus. Or Hong Kong. Now, I know there was a bit of a hiccup with the Royal London v Hughes case when Justice Morgan overturned the Ombudsman’s determination. But dear old Hughes had probably had a few Babychams too many – and it had slipped his mind that the law is supposed to be about justice and common sense. And that just because a particular piece of legislation has been written by an ass, it doesn’t have to be interpreted with stupidity.

“Significant time and effort goes into protecting members from scams”

This, of course, may be true. I only get to see the cases where the negligent ceding providers do hand over the pensions to the scammers. I rarely get to see the ones that have a narrow escape. But what worries me is that I am in the process of making complaints to the ceding providers who have handed over pensions to the scammers, and not a single one of them thinks they have done anything wrong. So, if they do spend “significant time and effort” doing the protecting bit, how come so many of them still fail so badly? And then try to deny they failed. These providers spend very significant amounts of time and effort writing long, boring letters about how they did nothing wrong – letters which must have taken them at least an hour to write. And yet they won’t spent two minutes checking – and stopping – transfers to obvious scams.

“The more detailed the due diligence, the more suspicious traits are identified”

I am a bit suspicious that this indicates a touch of porky pies here. I’ve never seen any evidence of ANY due diligence by the ceding providers. A bloke at Aviva once told me that they spent thousands on research and due diligence – but I see no evidence of it. The problem is, the ceding providers don’t know what they don’t know. And, to coin one of my favourite phrases: “they don’t know the questions to ask, and even if they did then they wouldn’t understand the answers”.

Interestingly, if – instead of repeatedly spending hours denying they did anything wrong when they handed over millions of pounds’ worth of pensions to the scammers – they spent some time talking to me and the victims trying to learn what went wrong and what due diligence should have gone into preventing a dodgy transfer, they might learn how to stop failing so badly.

SIPPS (including international SIPPS) are the vehicle of choice by scammers

Agreed. But the scammers still love the good old QROPS. But whether it is a SIPPS or a QROPS – both of which are just “wrappers” at the end of the day, it is about what goes inside the wrappers. Where the scammers make their money is in the kickbacks: 8% on the pointless, expensive insurance bond from OMI, SEB, Generali, RL360, Friends Provident etc., and then more fat commissions on the expensive funds or structured notes.

“Quality of adviser tops the list of practitioner concerns, with member awareness a close second”

And hereby lies one of the main problems: ceding providers don’t know who the good guys are and who the bad guys are. And that is because they don’t ask. And they don’t learn from their mistakes when they get it wrong. And they don’t care when they hand the pensions over to the bad guys and their former member is now financially ruined and contemplating suicide. Instead of trying to use their appalling mistakes to improve their performance and understand what “quality” actually means, and how to tell the difference between good and bad quality, they only care about avoiding responsibility for their own failings.

The problem about “member awareness” is that most people assume their ceding provider will do some sort of due diligence. They think that words like “Phoenix Life”, “Prudential” and “Standard Life” convey some sort of professionalism or duty of care. Most members are simply unaware of the appalling track record of these providers – and the extraordinary and exhaustive lengths to which they will go to avoid being brought to justice for their negligence and laziness.

“Sharing of intelligence would help avoid duplication of effort”

Oh, how heartily I agree! I remember a year or so ago, I shared some intelligence and a few beers with a nice chap from Scottish Widows. We met at one of Andy Agathangelou’s symposiums in London – the subject of which was pension scams. The Pensions Regulator was there, Dalriada Trustees were there, Pension Bee were there, lots of interested parties were there (including an American insurer from Singapore), and a couple of victims. I gave a joint presentation with one of the victims who described how he had been scammed and how his provider had handed over his pension so easily – well after the Scorpion watershed. The nice chap from Scottish Widows asked the victim why he hadn’t called the Police. The victim replied: “I am the Police”.

It was very telling that the room wasn’t full of delegates from Aviva, Phoenix Life, Prudential, Standard Life etc. None of them were interested.

Not a single provider has ever phoned me up to ask for advice, or to arrange to speak to some victims to learn something about how they were scammed and how and why their ceding providers had failed them so badly. There are so many victims all over the UK and the rest of the world. And what they all share is a passion to try to prevent other people from being scammed by the bad guys and failed by the bad pension providers. So this invaluable intelligence is freely available.

Until and unless the providers develop a conscience, they are going to continue to fuel the pension scam industry – and nothing will change. And the 79-page code might just as well be consigned to the bathrooms of Aegon, Aviva, Friends Life, Legal & General, Phoenix, Prudential, Royal London, Scottish Life, Scottish Widows, Standard Life and Zurich.

February 28, 2019
No more bogus life assurance policies in Spain
The Spanish Insurance Regulator – the DGS (Dirección General de Seguros y Fondos de Pensiones) – has made a most welcome judgment. This outlaws the mis-selling of bogus life assurance policies as investment “platforms” – aka “life bonds”. Read the translated summary below.

The iniquitous practice of scamming victims into these expensive, pointless bonds – so beloved by the “chiringuitos” (scammers) on the Costa Blanca and Costa del Sol for many years – will now result in criminal convictions for the peddlers of these toxic products.

The DGS’ judgment has provided reinforcement to the earlier Spanish Supreme Court’s ruling that life assurance contracts used to hold “single-premium” investments are invalid. This heralds a huge step forward in cleaning up the filthy scams which have for so long proliferated in popular British expat communities – making the victims poor and the perpetrators rich. This evil practice came to a head when scammers Continental Wealth Management collapsed in a pile of debris in September 2017. The main perps: Darren Kirby, Dean Stogsdill, Anthony Downs, Richard Peasley, Alan Gorringe, Neil Hathaway, Antony Poole all ran for the hills. Other scammers who played supporting roles – including Stephen Ward, Martyn Ryan and Paul Clarke – slithered away quietly to ply their scams elsewhere.

The DGS ruling has opened the way for criminal prosecutions against all those at Continental Wealth Management who profited so handsomely from flogging “life bonds” by Old Mutual International (aka OMI and Royal Skandia), Generali and SEB. While it goes without saying there will be a hearty cheer about the jailing of Darren Kirby and his merry men, they will soon be joined by other individuals who have joined in the bogus life insurance fest just as enthusiastically. And, of course, the life offices – from OMI, Generali and SEB, to Friends Provident and RL360 – will be treated to a proceeds-of-crime party.

Guest of honour will, of course, be Peter Kenny of OMI. But just to make sure nobody feels left out, Hansard and Investors Trust will certainly get their invites. Maybe Wormwood Scrubs will set up their own wing for life-office scammers.

It has long seemed curious that such a delightful part of Spain as the Costa Blanca should have fostered such an evil industry. From the arch scammer himself – Stephen Ward of Premier Pension Solutions, and his many associates including Paul Clarke who was helping him flog Ark before he joined CWM to learn to scam on a much larger scale. But anywhere along that delightful stretch of coastline running from Valencia to Alicante there are dozens of firms giving the life bond machine plenty of welly.

So popular is the use of life bonds among the seedier sector of the financial services industry, that multi-national firm Blevins Franks have their own their “exclusive” offering of bogus Lombard bonds. And you can see why: these scammers earn 8% from flogging these bogus life assurance policies. That’s 8% for doing nothing – and for trapping their victims into paying back this commission over up to ten years. Often long after the victims have worked out that the bond serves no purpose except to prevent the funds from ever growing.

The victims themselves – hundreds of which lost most (or in some cases all) of their life savings to Continental Wealth Management – will indeed see the DGS’ ruling as wonderful news. They will certainly celebrate the fact that justice has at last prevailed and that the law in Spain has made it clear that selling life assurance policies the traditional scamming way is illegal.

Continental Wealth Management (CWM – “sister company” to Stephen Ward’s Premier Pension Solutions) was set up initially to provide the cold calling and lead generation services to support Ward’s many scams – including the Evergreen (New Zealand) QROPS scam. Evergreen was swiftly followed by the Capita Oak and Westminster scams (now under investigation by the Serious Fraud Office). Unregulated, and staffed by unqualified salesmen who took it in turns to sport grand titles such as “Managing Director” and “Investment Director”, most of these spivs had been car salesmen or estate agents before flogging QROPS and life assurance contracts used to hold the toxic structured notes which destroyed so many millions of pounds’ worth of the victims’ life savings. Many of these bonds were supplied by Old Mutual International, who despite the huge losses on the funds, continued to take their fees monthly.

Back in April 2018, OMI and the IOM were defeated by Spanish courts ruling that the jurisdiction in litigation against them for facilitating financial crime should be in Spain. This was a welcomed victory for the victims in the face of so much corruption and fraud in Spain for many years. It is certainly a turning point in the quest for justice by the thousands of victims of scammers such as Continental Wealth Management and life offices such as Old Mutual International, Generali and SEB.

I will be writing to all advisory firms who are selling life bonds to victims in Spain to advise them that this is now a criminal matter and to warn them that they will be reported to the DGS.

————————————————————————————————————————————————————–

Madrid, 10 January 2019

General Directorate of Insurance and Pension Funds (DGS)

Complaints service file number 268/2016

COMPLAINT BY A CONTINENTAL WEALTH CLIENT IN RESPECT OF HEAVY LOSSES INCURRED ON HIS PENSION TRANSFERRED TO A BOURSE QROPS AND PLACED IN A GENERALI INSURANCE BOND.

The Directorate General of Insurance and Pension Funds is competent under the powers conferred on it by Article 46 of Law 26/2006 of 17 July, on the mediation of private insurance and reinsurance, to examine the claim formulated for the purpose of determining non-compliance with current regulations on the mediation of private insurance and reinsurance, and whether this is decisive for the adoption of any of the relevant administrative control measures, particularly those of administrative sanction, which contravene the aforementioned Law.

Article 6 of Law 26/2006, of 17 July, on private insurance and reinsurance mediation, which regulates the general obligations of insurance intermediaries, states:

“Insurance intermediaries shall provide truthful and sufficient information in the promotion, supply and underwriting of insurance contracts, and, in general, in all their advisory activity….”

Article 26 paragraphs 2 and 3 of Law 26/2006, of 17 July, on private insurance and reinsurance mediation, which refers to insurance brokers, establishes the following:

“Insurance brokers must inform the person who tries to take out the insurance about the conditions of the contract which, in their opinion, it is appropriate to take out and offer the cover which, according to their professional criteria, is best adapted to the needs of the former. The broker must ensure the client’s requirements will be met effectively by the insurance policy.”

Article 42 of the Private Insurance and Reinsurance Mediation Act, which refers to the information to be provided by the insurance intermediary prior to the conclusion of an insurance contract, provides:

“Before an insurance contract is concluded, the insurance intermediary must, as a minimum, provide the customer with the following information:
1. a) The broker’s identity and address.
2. b) The Register in which the broker is registered, as well as the means of verifying such registration.”
Insurance agents must inform the customer of the names of the insurance companies with which they can carry out the mediation activity in the insurance product offered.

In order for the client to be able to exercise the right to information about the insurance entities for which they mediate, insurance agents must notify the client of the right to request such information.

Banking and insurance operators, in addition to the provisions of the previous letter, must inform their clients that the advice given is provided for the purpose of taking out an insurance policy and not any other product that the credit institution may market.

Insurance brokers must inform the client that they provide advice in accordance with the following obligations:

“Insurance brokers are obliged to carry out and provide (to the customer) an objective analysis on the basis of a comparison of a sufficient number of insurance contracts offered on the market for the risks to be covered. Brokers must do this so that they can formulate an objective recommendation.”

On the basis of information provided by the customer, insurance intermediaries shall specify the requirements and needs of the customer, as well as the reasons justifying any advice they may have given on a particular insurance. The intermediary must answer all questions raised by the client regarding the function and complexity of the proposed insurance contract.

All intermediaries operating in Spain must comply with the rules laid down for reasons of general interest and the applicable rules on the protection of the insured, in accordance with the provisions of Article 65 of the Law on the Mediation of Private Insurance and Reinsurance.

Every insurance intermediary is obliged, before the conclusion of the insurance contract, to provide full disclosure. In the event that a mediator was an Insurance Broker or independent mediator, he is also obliged to give advice in accordance with the obligation to carry out an objective analysis. This must be provided on the basis of the analysis of a sufficient number of insurance contracts offered on the market for the risks to be covered. The mediator can then formulate a recommendation, using professional criteria, in respect of the insurance contract that would be appropriate to the needs of the client.

In the case in question, there is no evidence that the aforementioned information was provided to the client before the investment product was contracted. Therefore, Article 42 of the regulations has been breached.

Therefore, this Claims Service concludes that the mediator must justify the information and prior advice given to his client, so that the obligations imposed by the Law of Mediation can be understood to be fulfilled with the aim of protecting the insured. Failure to comply with their obligations could be considered as one of the causes of the damage that would have occurred to their client.

The claim is understood to be founded. In the opinion of this Claims Service, the mediating entity has committed a breach of the regulations regulating the mediation activity – specifically of the provisions of articles 6 and 42 of Law 26/2006 of Mediation of Private Insurance and Reinsurance.

The DGS requires the mediating entity to account to this Service, within a period of one month from the notification of this report, for the decision adopted in view of it, for the purposes of exercising the powers of surveillance and control that are the responsibility of the Ministry of Economy and Enterprise.

The interested parties are informed that there is no appeal to this judgment. Both the claimant and the mediating entity are made aware of their right to resort to the Courts of Justice to resolve any differences that may arise between them regarding the interpretation and compliance with the regulations in force regarding the mediation of private insurance and reinsurance, in accordance with the provisions of articles 24 and 117 of the Constitution.

Chief Inspector of Unit

Ministry of Economy and Enterprise

Secretary of State for the Economy and Business Support
February 17, 2019
NOVIA GLOBAL VS OLD MUTUAL INTERNATIONAL

The problem with money is that it blows away if you don’t hold it down, tie it up or stuff it down your knickers. That’s why you need to put it somewhere safe: in a shoe box on top of the wardrobe; under your mattress; in the safe or – if you’re feeling really brave – in the bank. Trouble is, left in cash, money shrinks (inflation, charges, moths). This is why so many advisers recommend a platform – aka “somewhere safe” to keep your money.

So, let’s look at two possible alternatives: the Novia Global platform and the Old Mutual International “bond”.

I’ve met Bill Vasilieff who runs Novia Global. He serves Earl Grey and nice biscuits. A man of few words, and even fewer syllables, he gave me a quick rundown on how the Novia Global platform works – and how much it costs.

I haven’t met Peter Kenny of Old Mutual International (OMI) – although I have spoken to him several times. As broadly Irish as Bill is Scottish, Peter Kenny also comes across as a softly-spoken and sincere chap. But there the similarity seems to end. Peter stood me up – I got a view of his office waiting room but wasn’t offered a cup of tea (let alone a biscuit).

Mind you, there isn’t much I don’t know about the Old Mutual International bonds. I’ve seen thousands of their policyholders’ statements – and they are frighteningly ugly and depressing. They accurately, faithfully and unemotionally report the destruction of their victims’ atrocious losses. And OMI regularly (like clockwork!) take their quarterly fees – irrespective of how deep the destruction of the policyholders’ funds is. In fact, some victims even find themselves in negative figures as OMI continue to account for their fees long after the whole blooming lot has gone.

Anyway, back to Bill and his welcoming teapot….I can’t really compare him to Pete but I can compare the two products. So here is a brief and brutal side-by-side line up of what the two “platforms” offer. And how much they cost. And how difficult they are to get out of. And how much financial crime they are associated with.

So the OMI “life bond” costs almost six times as much as the Novia Global platform. But that is if you are locked in for five years. You can get it cheaper – 1.15% – if you get locked in for ten years. But you must remember that if you are scammed, then OMI will have paid the scammer an 8% commission and you could get stuck with paying the quarterly fees for the next ten years, even if you’ve figured out you’ve been scammed. And the quarterly fees are based on your original investment – not on the impaired amount. If you’ve been scammed, and your fund value drops inexorably, the 1.15% will become bigger and bigger. And even if you lose your whole fund, OMI will keep taking their charges and pushing you further and further into debt.

A bit like the lyrics to Hotel California, with an OMI “bond”, you can’t check out any time you want, and you can only leave after between five and ten years. OMI will take that number of years to claw back the commission paid to your adviser – even if you have long since learned that your adviser was an unregulated scammer and has conned you into unsuitable, high-risk, high-commission investments that have badly damaged your fund. You are stuck with paying the quarterly fees to OMI – even after your whole fund has gone. One victim went from plus £300k to minus £25k – and counting. As your funds inside the OMI bond shrink, the 1.15% grows and helps destroy what is left of your fund even faster. But with the Novia Global platform, you can leave any time you want. No exit penalties. No hard feelings.

In Spain, the Supreme Court has ruled that bogus life assurance policies – such as those provided by Old Mutual International – used to hold investments are illegal. This is because they are neither proper insurance policies (which take risk in the interests of the consumer) nor are they proper investment platforms. The Spanish aren’t stupid – they can spot a scam much more easily than other jurisdictions and take action to prevent them from ruining future victims. This is in stark contrast to the likes of the Isle of Man and Gibraltar – which seem to revel in encouraging scams and protecting firms such as Old Mutual International (and STM Group) which facilitate financial crime on a massive scale.

January 30, 2019
Vueling v Old Mutual International

Intro written by Kim: ‘This week Angie travelled for work (yet again): she had to fly from Granada to Barcelona. Disaster struck – her baggage sadly did not make the full journey -it’s sitting in the triangle of lost luggage no doubt. The airline – Vueling – whilst only providing the flight, was still happy to take responsibility for the loss of her bag and its contents, and compensate her. That got her thinking: if an airline can take full responsibility for a loss, why are life offices like OMI turning a blind eye to the massive losses they have caused to thousands of pension scam victims’ funds?

Over to Angie:

The financial services industry (especially offshore) has a lot to learn from the airline industry. Aviation stakeholders internationally provide the highest possible levels of safety for air travellers. This due diligence is constantly reviewed, updated and improved. The same standard of responsibility routinely happens in all jurisdictions. Regulators, as well as air crash investigators, work together when things go right. As well as when they don’t.

The work of the air industry regulators, investigators and safety trainers never ceases with all parties constantly striving to maintain the highest possible standards of performance and safety. And when something goes wrong, everybody swings into action like the A-team, International Rescue and Tom Cruise combined.

I know all this because one of my members is a Captain with a well-known airline (probably quite easy to guess which one!). He also trains pilots from a variety of other airlines in simulators – and this includes Vueling pilots. I will call him Captain BJ.

BJ is a thoroughly decent bloke and has a rather endearing fondness for chickens. He has devoted his professional life to the business of safety in travel. And behind him is a comprehensive and robust system of regulation – internationally. Financial services regulators, on the other hand, stand by and watch (with their hands firmly in their pockets – and their fingers compulsively searching for something with which to fiddle) as the equivalent of hundreds of passenger planes crash every month. The regulators stare blankly at the charred remains of the passengers’ life savings and shrug carelessly at the huge scale of human misery caused so routinely. With such flaccid regulatory regimes in so many jurisdictions, these chocolate-teapot regulators de facto facilitate and encourage losses caused by negligence and scams.

I know all this because Captain BJ is also a pension scam victim – courtesy of Stephen Ward’s Ark £27 million pension scam. Despite the extreme stress of losing his pension, he has to keep a stiff upper lip and continue with his daily routine of flying thousands of passengers safely around the skies of Europe.

My recent experience on a Vueling flight provides an interesting parallel with the “financial services” provided by Old Mutual International. Vueling sells flights. They provide the aircraft; the pilots and the cabin crew. They offer a selection of routes, food and drink, duty free goods, toilets and the expertise to get many thousands of passengers from one destination to another safely and on time; day after day after day.

What Vueling doesn’t do is operate a baggage handling service – this is provided by the airport you travel through. However, no matter how enjoyable a flight has been (if such a thing is possible!) and how punctual the take-off and landing are, the whole experience can be badly marred by the loss of a passenger’s luggage. While Vueling is responsible for the safety of the passengers, it is NOT responsible for the safety of the passengers’ luggage when it is not in the bowels of the aircraft. However, Vueling goes to extraordinary lengths to help people whose luggage has been delayed or lost. Vueling take full responsibility for a loss of luggage, luckily for me.

Earlier this week, it was the baggage handlers at either Granada airport or Barcelona airport who were responsible for my medium-sized, black, tatty suitcase. And they lost it. The case had been full of clothing typically worn by a slightly fat, grey-haired woman on the wrong side of something ending in a nought. So no desirable or valuable designer totty wear, expensive perfume or sparkly jewellery.

But Vueling provide people like me (who end up wearing the same orange jumper and purple socks two days in a row) with an easy to use, online complaints and redress facility. It wasn’t Vueling’s fault that my luggage got lost, but they take responsibility for it anyway because it is part of the whole flight “package”.

Contrast this with Old Mutual International (OMI) and the IoM regulator. And thank your lucky stars that they don’t try to run an airline (because if they did, it is unlikely any passengers or luggage would ever survive). OMI provides “insurance bonds” or bogus life assurance policies. These products serve no purpose except to pay fat commissions to rogue IFAs. And they feature a selection of risky investment products for the IFAs to earn even more commission. What OMI does not provide is financial advice – that is the job of someone else (i.e. the IFAs). But when the IFAs do the equivalent of losing the baggage, OMI takes no interest or responsibility other than to record the loss.

In the air industry, there are two things that can go wrong that can cause customers financial damage: flight delays and loss of luggage. A comprehensive complaints and redress system is routinely provided by all leading airlines. In the financial services industry, there are two things that can go wrong that can cause customers financial damage: investment failures and disproportionately high charges. No complaints and redress system is provided by life offices such as OMI and no one takes full responsibility for a loss.

If an airline experiences a crash, a huge machine swings into action to investigate the cause and take immediate remedial action to prevent the same or similar event from ever causing another accident. If a life office such as OMI experiences a crash, it pretends nothing has happened. Pension scam victims? No pension scam victims here! OMI denies all responsibility. And blames the IFA. Or the weather. Or Brexit. And keeps charging the victims the same disproportionately high fees based on the huge commissions they originally paid to the IFA that caused the crash.

Here are some examples of OMI’s crashes in the past six years:

* Axiom Litigation Fund – this was a PROFESSIONAL-INVESTOR-ONLY fund which was routinely used by rogue IFAs for ordinary, retail investors (and from which the IFAs earned fat commissions). OMI offered the Axiom fund on the bogus “life assurance” platform. And when the fund went into administration in December 2012, OMI shrugged its shoulders and said “not our problem“. And kept charging the victims the same fees as if the £120 million loss hadn’t happened.

OMI knew that many of the IFAs had been neither regulated nor qualified and that the investors were unsophisticated, low-risk, retail customers.

* LM Australian Property Fund – this was a PROFESSIONAL-INVESTOR-ONLY fund which was routinely used by rogue IFAs for ordinary, retail investors (and from which the IFAs earned fat commissions). OMI offered the LM fund on the bogus “life assurance” platform. And when the fund went into administration in March 2013, OMI shrugged its shoulders and said “not our problem“. And kept charging the victims the same fees as if the £240 million loss hadn’t happened.

OMI knew that many of the IFAs had been neither regulated nor qualified and that the investors were unsophisticated, low-risk, retail customers.

* Premier New Earth Recycling Fund – this was a PROFESSIONAL-INVESTOR-ONLY fund which was routinely used by rogue IFAs for ordinary, retail investors (and from which the IFAs earned fat commissions). OMI offered the PNER fund on the bogus “life assurance” platform. And when the fund went into administration in June 2016, OMI shrugged its shoulders and said “not our problem“. And kept charging the victims the same fees as if the £800 million loss hadn’t happened.

OMI knew that many of the IFAs had been neither regulated nor qualified and that the investors were unsophisticated, low-risk, retail customers. That is £1.16 billion worth of fund losses in just over six years, but they take no responsibility for loss of funds and the pension scam victim gets no redress.

(Note – if you read the above three examples, you will see that although the funds, dates and amounts were different, the circumstances were EXACTLY the same!)

Add to this the £ billions lost through toxic, risky structured notes, and that adds up to quite a cricket score that OMI “wasn’t responsible for“.

The causes were all the same:

UNREGULATED ADVISORY FIRMS

UNQUALIFIED ADVISERS

FUNDS OFFERING HUGE COMMISSIONS

FUNDS SUITABLE FOR HIGH-RISK, PROFESSIONAL INVESTORS SOLD TO LOW-RISK, RETAIL INVESTORS

NO DUE DILIGENCE BY OMI

We know that OMI bought:

£200 million worth of failed Leonteq structured notes

between 2012 and 2016 as OMI is claiming to be suing Leonteq. But this does little to distract attention from OMI’s multiple, long-term failures for allowing such toxic investments in the first place and causing many people to become pension scam victims.

If I give my car keys to someone who is so drunk they can barely stand up – and certainly can’t spell either OMI or IOM – and there is a serious accident, whose fault is it? The drunk’s or mine?

OMI’s CEO is a bloke called Peter Kenny who used to work for the IoM regulator. So he should know better. But he doesn’t. So we must assume he would be happy to hand his car keys over to a drunk or let an unqualified pilot fly a plane with a broken wing. And he would still claim it wasn’t his fault, despite the number of pension scam victims.

The moral of this blog is: never wear orange and purple on a flight; never use an OMI life bond; always use a qualified, regulated and insured IFA. Don’t become the next pension scam victim.

My next dilemma is what to buy with my Vueling compensation. I feel a trip to Marks and Sparks coming on. (I needed a bigger size anyway!).

(Huge thanks to Captain BJ – to whom I owe my sanity).

PS – since we wrote and published this blog, my luggage has been found. Apparently, it never left Granada airport. I suspect somebody pinched it – then found the clothes inside were so dull that they didn’t think it was worth taking it after all.

CWM Pension scam – A victim’s reconstruction

January 17, 2019
YET ANOTHER STRUCTURED NOTE SCAM BY OLD MUTUAL INTERNATIONAL

ROLL UP! ROLL UP! ME HEARTY SCAMMERS! OMI’S LATEST STRUCTURED NOTE SCAM IS ONLY AVAILABLE UNTIL SEPTEMBER 28TH SO GET A JIGGLE ON WHILE STOCKS OF THIS TOXIC CRAP LAST! WE ARE PROUD TO OFFER OUR VALUED SCAMMERS YET ANOTHER INVESTMENT SCAM

BY OLD MUTUAL INTERNATIONAL.

This wonderful investment scamming opportunity with OMI, is open to all scammers – you need no qualifications and don’t have to be regulated. If you want a bit of training in how to sell this rubbish inappropriate structured product to as many victims as possible, we can give you a quick five-minute whisper behind the bike shed. But, trust me, it is easypeasylemonsqueezy – just lie. Tell the victims about the “guaranteed 10% return” bit, but don’t tell them about the “capital at risk” bit.

So, what are you waiting for? You’ll earn 8% by selling your victims a useless OMI “PORTFOLIO” bond (don’t mention this is illegal in Spain) and then a further 8% from selling this toxic, high-risk BNP Paribas structured note (rubbish inappropriate structured product) which will tie your victims in for six years.

This will give you plenty of time to explain away the losses as “only secondary market values” or “only paper losses”. And by the time your victims realise what you’ve done to them, you’ll be long gone. And most of them will commit suicide anyway, so they won’t be coming after you any time soon.

BNP Paribas has a good reputation as being an ethical, solid company so that will certainly help you with sell these inappropriate structured products. Just remember, tell the victims as little as possible about this product and hide the commissions you will earn – they will never find out and by the time their life savings have all gone up in smoke you will be sunning yourself on a Caribbean island, far away from the misery of those whose retirement income you will have destroyed.

If the victims are ever organised enough to band together and form a group action, I’ll just promise to pay redress for their losses, organise a meeting and then cancel it at the last minute. That ought to buy you enough time to make your getaway.

Happy scamming – smiley face. Love from Pete

p.s. BTW, don’t worry about the email below the Mad Woman of Spain has sent out – most of the new victims will never have heard of her and by the time they do, it will be too late. You’ve only got until 28th September to scam as many suckers as possible, so don’t just stand there – SCAM AWAY ME HEARTIES!

p.p.s. Don’t worry about my quote about inappropriate structured products – I was just lying (something I’m pretty good at). With the announcement of new regulations in Malta for QROPS, International Adviser has quoted managing director of OMI (soon to be Quilter) Peter Kenny: “Old Mutual International is encouraging all market participants to help rid the industry of inappropriate structured products”

———————————————————————————————————————————————————-

ATTENTION PAUL EVANS – Head of Region – Middle East & Africa
Old Mutual International (International Structured Scam Specialists)

intmarketing@engage.omwealth.com

1st September 2018

Paul, are you completely mad? OMI has been offering and buying inappropriate structured products for years and facilitating financial crime by scammers such as Continental Wealth Management. OMI bought £94 million worth of fraudulent notes by Leonteq – which paid the scammers an extra 2% in commission. So you must have been accepting business and investment instructions from other scammers besides CWM for at least six years between 2012 and 2016 – as well as for years prior to and subsequent to this period.

And now you are offering more structured notes so scammers can line their pockets and ruin more victims? Read your own marketing material Mate:

“An autocall product with a six-year term paying at least 10% a year in USD or at least 7% a year in GBP. This is a capital at risk product.”

You are a pathetic and revolting human being. Which bit of CAPITAL AT RISK don’t you understand?? OMI has already disgraced itself by offering, buying and selling these totally inappropriate structured products – scam products -, and caused millions of pounds’ worth of destruction to innocent victims’ life savings.

You, Peter Kenny, Steve Braudo and Paul Feeney are all as bad as each other – and none of you should be working in financial services. Your conduct is utterly sickening: you are now proposing to ruin more lives and you still haven’t paid compensation for the lives you have destroyed already.

How much commission are you paying the scammers on these toxic products? 6%? 8%? 10%?

Instead of behaving with decency and dignity and honouring Old Mutual International’s promise to pay redress for OMI’s past failures, you are now preparing to launch a whole new tranche of financial crime and inappropriate structured products.

You are all disgusting and this needs to be exposed and all of you outed for the evil scum you are.

Angie

From: Paul Evans – Old Mutual International <intmarketing@engage.omwealth.com>
Subject: Competitive, transparent, simple – new tranche of structured products

September 1, 2018
Structured notes – knowing the risks

In many pension scams, we see the use of totally unsuitable, high-risk, for-professional-investor-only structured notes. These notes often offer the introducer high commissions. However, they are risky, fixed-term investments that often end in the loss of some – or even all – of the fund invested. Therefore, these types of investments are totally unsuitable for a pension fund. Firstly, let me explain what a structured note is, and then we can go through structured notes – knowing the risks.

So what the hell are structured notes? And why should retail 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.

A pension fund is referred to as a retail investment, so it should be placed in a low to medium risk investment. Generally, structured notes are labeled high-risk, for professional investors only and, therefore, no pension fund should ever be invested into them.

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.

Say NO to structured notes for pensions!

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.

In the case of CWM, 1,000 people with 100 million pounds, were invested in structured notes and many of them lost large chunks of their funds. The CWM scam, headed by Darren Kirby, used structured notes with Commerzbank, Nomura, RBC and Leonteq, and many of the notes crashed.

John Rodgers fell victim to the CWM scam after being cold called by a salesman called Dean Stogsdill . His £202,000 pension pot was invested into high-risk, professional-investor-only structured notes referred to as “Blue Chip Notes”. Today John’s pension fund is worth just £60,000 (if he is lucky).

OMI help facilitate the unqualified, unlicensed and unregulated CWM scammers – victims of this scam were also tied into a useless, pointless insurance bond for ten years – courtesy of OMI. Whilst the value of these pension funds steadily plummeted, OMI stood idly by and watched it happen.

In the case of the Continental Wealth Management scam, the life offices – Old Mutual International, SEB and Generali, invested up to 1,000 victims’ life savings in structured notes. The majority of these toxic notes were from Commerzbank, Royal Bank of Canada, Nomura and Leonteq – some of which were, allegedly, fraudulent. Victims are facing huge losses – and a few have had their retirement savings wiped out entirely and a couple are now in negative territory due to the parasitic life offices continuing to take their quarterly fees (based on the original investment) as the investors are trapped into these spurious “bonds” for up to ten years.

We are now fighting to get the investors’ money back. But meanwhile, we must stress: do not use an advisory firm that uses structured notes. These toxic instruments are only for professional investors and should not EVER be used for ordinary, retail investors.

August 14, 2018
WANTED: MAGIC FAIRY TO CURE WHAT’S WRONG WITH FINANCIAL SERVICES OFFSHORE

Humour me – you may consider me to be naive – but I believe that the ills of financial services (especially offshore) can be put right. All it takes is for the ethical stakeholders to outlaw the unethical ones. Yes, it will be a bit like something out of the Old Testament – but I firmly believe it can be done. And, more importantly, it MUST be done.

So many thousands of victims have lost part or all of their life savings already – and these people must be compensated. But, above all, future victims must be prevented.

Here’s my TOP TEN wishes that I want the Magic Financial Services Fairy to grant (as a matter of urgency):

Governments in the UK and all expat jurisdictions must wake up to scams – both offshore and at home. They must empower/galvanise law-enforcement agencies and give them the resources to tackle financial crime.

Regulators must put together effective regulations – and then ENFORCE them. Regulations on their own are worthless and pointless – the industry must be policed and failure to comply with regulations must be severely sanctioned.

Ceding pension providers must stop handing over thousands of pension transfers to scammers. The Scorpion campaign has had a negligible effect and all leading providers are still at it.

Advisory firms must be regulated – and not just for insurance. If all a firm does is sell insurance, that is fine. But if pension and investment advice is given, the firm must be properly regulated.

Advisers must be appropriately qualified. If they don’t have the right qualifications, they must demonstrate that they are studying and aiming to qualify within a reasonable, pre-determined time frame.

Investors with DB scheme transfers must get proper advice – avoiding flimflam which takes no responsibility for the end result of the transfer. QROPS providers must ensure they only accept business from regulated firms.

QROPS providers must also ensure they have understood and verified the members’ risk profiles – and then ensure that any investments made on behalf of those members are in line with their risk profile.

Life offices must stop accepting business from known scammers and unregulated firms – and cease investing victims’ life savings in unsuitable assets – such as structured notes and UCIS funds.

Life offices must pay redress to their victims for investment losses caused by negligence and fraud.

There must be a quality assurance system to which all offshore advisers, life offices, trustees and fund managers subscribe and adhere.

July 29, 2018
OLD MUTUAL INTERNATIONAL V LEONTEQ CASE MOVED TO LONDON

Old Mutual International filed a High Court application on 16^th March 2018.

On 20.3.18, Old Mutual obtained a judgment in the High Court of Justice of the Isle of Man (Case Reference 18/0012). His Honour The Deemster Doyle, First Deemster and Clerk of the Rolls delivered his determination to OMI’s lawyer, Elizabeth Simpson of Simcocks.

But now Leonteq has been successful in having the proceedings transferred from the IoM to London. This will considerably help Leonteq and hinder OMI.

OMI’s case is that they are the victims of a fraud. Between 2012 and 2016, OMI invested approximately £200,000,000 in structured notes sold by Leonteq. The purchase of these notes was “conducted” on the truthfulness of representations made by Leonteq as to the amount of fees and costs to be deducted from the investments. OMI’s case is that what Leonteq claimed was false and fraudulent. The investments performed poorly as a result of the excessive level of fees. The losses are currently estimated to be well over £20,000,000 (although it is expected that this will increase – especially with the current devasting share price falls due to Covid 19).

OMI’s case against Leonteq is on the basis of fraudulent misrepresentation, conspiracy, constructive trust, breach of fiduciary duty, knowing receipt, dishonest assistance and unjust enrichment.

Let us look in some detail at the above aspects of the case.

Leonteq Securities has gone from strength to strength since this fraud began – despite the disgrace of this criminal matter. Their net profit in the first half of 2018 was declared as £30.73 million, and turnover £104.31 million – up 36% on the previous year. My first question is: are they still selling ultra high-risk structured notes? My second question is: what was the difference between the “ordinary” notes which paid 6% commission to the scammers, and the fraudulent notes which paid 8% to the scammers. Were the latter 33% more risky? Looking at the victims’ statements, it is impossible to tell the difference between the 6% notes and the 8% ones. There is no obvious higher failure rate – they just all look equally dire.

Right in the middle of the OMI/Leonteq matter, it was announced in 2014 that two salesmen were going to be added to the London branch: Walter Treur and Anders Stromberg joined on 25/27 June 2014. Treur was ex Commerzbank – another provider of toxic structured notes which also failed dismally and caused catastrophic losses to the Continental Wealth Management’s victims – and Stromberg was ex JP Morgan and Credit Suisse (although he had been unemployed for some time).

Another Leonteq employee, Michael Hartweg, left his job as deputy chief executive to spend all his time flogging the new business of toxic structured notes.

So, it is clear that Leonteq was making a lot of money out of these products. But, the question remains: was Leonteq complicit in fraud – or were they blissfully ignorant and just grateful for the huge profits they were pulling in?

In my humble view, structured notes are like a lot of other products which – if properly sold and used – can, in some cases, be beneficial/useful/enjoyable/harmless, but – if irresponsibly or inappropriately sold – can be deadly. Examples are: tobacco; alcohol; pornography; rat poison; fireworks; painkillers; kitchen knives; peanuts; plastic bags; cannabis.

Structured notes are “FOR PROFESSIONAL INVESTORS ONLY AND NOT FOR RETAIL DISTRIBUTION AND WARN OF DANGER OF LOSING PART OR ALL OF AN INVESTOR’S CAPITAL”.

I wonder which bit of that OMI failed to understand. They bought £200 million quid’s worth of the fraudulent 8% notes – how much of the 6% ones did they buy? We know that a large chunk of these went to the Continental Wealth victims and caused devastating losses. But that was just Leonteq – there was also Commerzbank, Royal Bank of Canada, Nomura and BNP Paribas. And there wasn’t just OMI – there was SEB and Generali doing the same thing.

Let’s be honest, the whole thing was a fraud. In the Continental Wealth Management case, CWM was a fraud; the structured notes were a fraud; the insurance bonds were a fraud; the hidden commissions on everything were a fraud. No party comes out of this with any honour. But, we must also bear in mind that OMI bought £200,000,000 of this toxic, fraudulent crap and allowed it to be used as investments for retail, low-risk pension savers. Additionally, OMI accepted dealing instructions from an unregulated firm which was selling the insurance bonds illegally. But let us not forget that Generali and SEB were just as bad.

Maybe Leonteq and OMI will volunteer to settle without a bloody legal battle – from which only the blood-sucking lawyers will win. The millions that both Leonteq and OMI will be paying over the coming months and years would be better spent on paying redress to the real victims in this disgraceful debacle – the Continental Wealth Management clients who entrusted their life savings to the scammers, the life offices and the structured note providers such as Leonteq – but let’s not forget Commerzbank, Royal Bank of Canada and Nomura.

July 21, 2018
SEB LIFE (OR DEATH) – WILL THE CENTRAL BANK OF IRELAND BRING THEM TO JUSTICE?

One of the hundreds of Continental Wealth Management victims stuck in a useless and expensive SEB Life International bond, and ruined by crippling investment losses, has made a detailed complaint to SEB.

Some idiot from SEB called Orla Golden has replied – and the response is astonishing. Below are my answers to this ridiculous rebuttal. The complaint will now be referred to the Central Bank of Ireland – asking that SEB Life should be suspended. I will also copy this in to the Financial Services Ombudsman.

Let us see whether the regulator and ombudsman in Ireland will turn out to be as useless as the regulator in Gibraltar, or will actually have some teeth. If the authorities in Ireland are any good, hopefully they will hold Conor McCarthy and Peder Nateus fully responsible for facilitating this deplorable scam.

LETTER FROM ORLA GOLDEN TO THE CWM/SEB VICTIM IN RESPONSE TO HIS COMPLAINT (WITH MY COMMENTS IN BOLD):

We are writing to you in response to your recently submitted complaint in respect of your insurance policy with SEB Life International Assurance Company DAC that you placed through your appointed independent financial advisor, Inter-Alliance WorldNet Insurance Agents and Advisors Ltd.

The victims did not place any orders or instructions through Inter-Alliance. SEB is being not only disingenuous but dishonest here. The advisor in question was Continental Wealth Trust SL, trading as Continental Wealth Management SL (CWM) in Alicante Province, Spain. CWM was a firm full of unqualified so-called “advisers” with a track record of scamming, cold-calling and flogging dodgy products to unsuspecting victims. The victims appointed CWM as their advisers, and all the dealing instructions for the toxic structured notes came from CWM and not Inter-Alliance.

SEB Life is a designated activity company which is registered under company number 218391 with the Irish Companies Registration Office and is authorised as a life insurance undertaking by the Central Bank of Ireland under number C771.

So, let’s see just how good a regulator the Central Bank of Ireland really is. We must all hope it is not as hopeless, limp and corrupt as some of the other regulators.

SEB Life is permitted to distribute life insurance policies in Europe (EU) by way of a freedom of services passport issued by the Central Bank of Ireland under the Solvency II Directive 2009/138/EC as adopted into Irish law by the European Communities (Insurance and Reinsurance) Regulations 2015 (the “Solvency II Irish Regulations”). That may be true, but these weren’t true life insurance policies: they were bogus policies designed to act as “wrappers” for dodgy, rubbish investments and to facilitate financial crime in multiple European jurisdictions – most notably Spain where such insurance/investment products have been outlawed by the Spanish Supreme Court.

In January 2015, Inter-Alliance novated its business to Trafalgar International GmbH who became your financial advisor.

Not true. Trafalgar International did not become the financial adviser. Few, if any, of the victims had ever heard of Trafalgar until CWM collapsed in September 2017.

Trafalgar is an independent financial advisor located in Germany

No it isn’t – it is located in Cyprus. Orla Golden clearly has never done Geography.

and is authorised and entered into the register of insurance intermediaries maintained by the Chamber of Industry and Commerce (DIHK). Trafalgar is authorised to mediate insurance policies in various EU territories including UK, Spain, Malta and France. Yes, Trafalgar was. But CWM wasn’t.

SEB Life has terms of business with Trafalgar, and previously had terms of business with Inter-Alliance which was authorised by the Insurance Companies Control Service in Cyprus to mediate insurance policies in the EU; before it transferred to Trafalgar. Continental Wealth Management (CWM) was a sub agent of Inter-Alliance

Really? Sub agents are illegal in Spain

and then continued to be a sub-agent of Trafalgar.

No it did not. SEB is lying. CWM was never a sub agent of Trafalgar

CWM is the responsibility of Trafalgar and SEB Life does not have terms of business with them.

So why did SEB accept dealing instructions from CWM if they had no terms of business with the firm?

SEB Life regularly reviews the authorisation of independent financial advisors with whom they have terms of business,

SEB is failing to get its story straight. CWM was not authorised – ever, for anything. SEB may have had terms of business with both Inter-Alliance and Trafalgar, but CWM was never an authorised agent of either firm.

however, it is the independent advisor’s responsibility to comply with their own regulatory obligations for authorisation

And nothing to do with SEB? So, why did SEB accept dealing instructions from CWM?

and their regulatory authorities have oversight responsibilities.

Like the Central Bank of Ireland has oversight responsibilities over SEB? Let’s see how seriously it takes those responsibilities.

Trafalgar, as the appointed independent financial advisor is your agent.

No it isn’t, and wasn’t. Trafalgar was not an IFA firm, it was a network.

Any policy related intermediary commission was paid directly to Trafalgar (formerly Inter-Alliance), with whom SEB Life has terms of business.

So why was SEB paying intermediary commission at all to CWM which was not regulated at all for anything – not pet insurance, not bicycle insurance, nothing. It matters not to whom the commission was paid, the products were sold by an unregulated firm (CWM) and SEB should never have accepted the business – let alone ever paid commission (irrespective of to whom this commission was paid).

As your agent, Trafalgar must handle your complaint in accordance with their agent and regulatory responsibilities.

Trafalgar was never the victims’ agent.

In addition, the pre-sales advising process occurs between you as the policyholder and your appointed agent.

Trafalgar was never the appointed agent. Trafalgar did not provide the advice; Trafalgar did not place the dealing instructions; Trafalgar did not meet the clients.

This process identifies the customer’s needs, based on the information provided by the policyholder(s)

How would SEB know? Did they ever check the fact finds or make any attempt to ascertain the victims’ attitude to risk? No, of course they didn’t

and recommends the insurance product which best suits the customer’s objectives and needs.

This is a ludicrous comment to make. Not one single victim needed a bogus life assurance product – they were all, 100% mis-sold purely for the fat commissions paid by SEB.

SEB Life is not party to this pre-sales advising process and the discussions that occur between a policyholder and their appointed independent financial adviser as to their risk profile and the assets that will fulfill the investment needs and objectives.

Correct. But SEB ought to have noticed, over a period of several consecutive years, the inexorable losses from the toxic structured notes which repeatedly failed – and the dealing instructions for which (submitted by CWM and accepted by SEB) bore forged client signatures. SEB may not have been party to the pre-scamming advice con, but they should certainly have taken action when the results of this clear fraud started to become obvious.

SEB Life does not offer any investment advice, and this is clearly stated in the declaration section of the application form that we ensure is signed by the customer.

And damn good job too. Most victims would probably trust a convicted thief rather than SEB. The declaration section of the application form may make it clear that SEB does not offer investment advice, but the annual statements also make it clear that SEB can do maths. And that basic maths demonstrated that hundreds of policyholders’ funds were being routinely destroyed.

Our literature states that the amounts invested in the Units of the Fund in the contract are not guaranteed but are subject to fluctuations in value depending, in particular, on the performance of financial markets.

There is fluctuation, and then there is total destruction. Fluctuation goes up and down. Destruction just goes down. Did not a single half-wit at SEB notice the difference over a period of seven years?

The return on investment is not in SEB Life’s control and past performance is not an indicator of the future performance of any asset.

So, if Bloodstone Building in Dublin caught fire, would the blind, deaf and dumb idiots at SEB just sit there, shrug their shoulders and say “a fire in the building is not within our control – we aren’t firefighters. And we won’t even bother using the fire extinguishers or calling the fire brigade. We’ll just sit here and watch the building get destroyed and burn to death ourselves?”

SEB also request that a one-page “Statement of Understanding” is signed by a policyholder where an investment request is received in relation to a non-standard asset.

Really? Who told Orla Golden that? The Statement of Understanding Fairy? This simply is not true.

This is to confirm that the policyholder has read and understood the potential financial, market and liquidity risks associated with the asset before proceeding.

None of the victims understood the assets which SEB was permitting the scammers at CWM to churn; none of the victims realised or understood what structured notes; none of the victims knew that structured notes were for professional investors only and not for retail investors; none of the victims knew that they stood to lose part or all of their investment (as most did); none of the victims realised that SEB would just sit there and let the repeated losses keep happening as the unlicensed, unqualified scammers at CWM kept scamming away for seven years.

Policyholders are able to request that their policy be linked to assets that are within the company’s permissible asset list. The investments have been executed by SEB Life on the basis of written instructions submitted to SEB Life that were signed by you as the policyholder

No they weren’t – the signatures were forged

or your appointed investment advisor.

Meaning the unqualified, unlicensed scammers at CWM who did not have an investment license – let alone an insurance license.

SEB Life relief upon and implemented those instructions in good faith and in accordance with the terms and conditions of the policy.

There was nothing good about SEB’s “faith”. This particular victim – whose complaint has not been upheld by SEB – suffered the following losses between 2009 and 2015:

12 toxic, professional-investor-only structured notes from Nomura, RBC, Commerzbank, Leonteq and BNP Paribas:

Lost a total of 271,539 EUR

Investment in the Quadris Teak UCIS fund:

Lost 100,000 GBP

TOTAL LOSS IN SIX YEARS: 371,539 EUR

Didn’t SEB notice? Didn’t SEB care? Didn’t SEB do anything for seven years?

The answer, of course, is a resounding no. The lazy, callous, greedy, negligent did nothing except sit there and watch this victim’s life savings be destroyed by the scammers.

With regard to your allegations of regulatory breaches and fraud committed on your policy, SEB Life is unable to comment on such allegations and these must be discussed with your appointed financial advisor Trafalgar directly.

I have no doubt that SEB’s lawyers will have advised them to keep their mouths shut on this one and to try to deflect the blame onto Trafalgar. This is one of the things I hate about lawyers – even when they know their dirty clients are guilty they will still defend them to the hilt. As long as they keep billing, the lawyers won’t care how many lives their negligent and culpable clients ruin.

In these circumstances, you may wish to seek independent financial advice

I wonder what sort of “adviser” SEB have in mind? Scammers like CWM?

and/or legal advice regarding your engagements with your appointed financial adviser.

And I wonder what sort of law firm SEB would recommend? A dodgy firm like SEB’s own lawyers who are happy to make money out of defending the indefensible?

July 12, 2018
Old Mutual International (OMI) facilitating financial crime

From 2010 up to the present day, Old Mutual International has been facilitating financial crime by allowing scammers to misuse and abuse OMI “life bonds” to scam victims out of their life savings.

The victims of the CWM scam are still wondering how the hell they lost an average of 60% of their life savings. Old Mutual International (Quilter) was the provider for the bulk of the life bonds used in the CWM debacle, taking huge amounts of business from unregulated scammers Continental Wealth Management. OMI also paid CWM huge amounts of commission – in the full knowledge that CWM was unregulated and a known, serial scammer.

Pension Life members of the CWM victim group have supplied their figures to us. The losses are huge and we believe that these figures need to be shared with the public so Old Mutual International (OMI) understand and take responsibility for the devastation they have facilitated to the lives of the victims.

Let us hope that Old Mutual International will step up to the plate. The people who work at OMI are human beings, with loved ones. Hopefully, they can imagine how they would feel if this tragedy had happened to one of their loved ones – while the people at OMI stood by and did nothing to stop the devastation. For more than eight years, OMI employees sat on their hands while the so-called investments inside their “insurance bonds” plummeted in value. And OMI did absolutely nothing. Just kept taking their quarterly fees.

OMI will, of course, try to say it was not their fault. That it was down to the advisers appointed by the victims. Or the trustees. Or both. Or the Boogeyman. OMI will claim that they had every right to sit there and watch millions of pounds worth of life savings being wiped off investors’ funds, while continuing to take out their huge quarterly fees.

I wonder how OMI/Quilter directors would feel if this happened to one of their loved ones. Or if someone they cared about had been drowning, and a crowd of people had stood by and watched them die. Because, make no mistake, there will be deaths as a result of this. And the people at OMI will have this on their conscience for the rest of their lives.

OMI’s victims have died. And more are dying. This industry is about people. Let us see if OMI cares about their fellow human beings. Because, so far, there is zero evidence that they give a toss.

May 23, 2018