Recent data obtained by Quilter (formerly Old Mutual International and Royal Skandia) under a freedom of information request has further highlighted the issue of financial education, or rather the lack of it, with many casualties of fraud ‘unaware they may have fallen victim‘ to such a scheme.
Quilter plc (the well-known asset/wealth management company, “life office”, and old friends of ours) has recently acquired figures clearly showing an absence of any kind of appropriate action from the ironically-named Action Fraud organisation. This data demonstrates that despite 400 pension fraud reports having been submitted to the inept crime-reporting centre in 2019 alone, as few as 26 of these cases were passed on to the police to investigate – representing just 6.6% of the total cases they handled.
| Year | Pension fraud reports received by Action Fraud | Pension fraud reports reviewed by NFIB | Pension fraud reports disseminated to the police and other agencies |
| 2015 | 1353 | 208 | 208 |
| 2016 | 547 | 97 | 97 |
| 2017 | 409 | 62 | 62 |
| 2018 | 346 | 46 | 38 |
| 2019 | 394 | 46 | 26 |
| Up to July 2020 | 161* | N/K** | 24* |
14 September 2020
*Figures omit February 2020 bulk upload of retrospective reports to avoid misrepresenting case volumes in 2020.
** Figure not disclosed in the FOI response
These same figures show that this year (as of July 2020), of the 161 pension fraud reports that were received by Action Fraud, only 24 have been disseminated to the relevant police force for investigation after the information was reviewed by NFIB (the National Fraud Intelligence Bureau). While this may represent a slight statistical improvement on previous years, this is neither good enough nor in any way acceptable – both for the victims of financial fraud, and the honest, decent, hardworking IFA’s out there who have seen the reputation of their profession suffer greatly at the hands of fraudsters and scammers alike.
The time has come to call out the thieves in their midst!
Scams, and the lack of an active regulator in place to ensure their non-proliferation, undermine the reputation of the industry itself – and of any decent advisers out there.
The supposed altruism behind the actions of Quilter, who have seen the story of their plucky attempt at standing up for the little guy circulated by almost every major financial publication available in the UK, and by a fair few online and overseas English-language webpages/articles besides, is questionable at the very best – and a downright attempt at pulling the famous ‘Kansas City Shuffle‘ (when everybody looks right, you go left) at worst. I would like to use this opportunity to call “bull-“, as I believe I have heard my American friends say when faced with a claim that is clearly one of the more than 50 shades of bovine excrement currently available from all major stockers of the substance.
Quilter has, in the past ten years, facilitated hundreds of millions of pounds’ worth of pension scams with their “fertilizer”-based products.
Previously operating under the name Old Mutual International, OMI or Old Mutual for short, Quilter has helped the serial scammers behind all kinds of financial skullduggery get away with murder (or should I say fraud, to be more specific) under the – cough – “watchful” gaze of their CEO Paul Feeney, and Peter Kenny (another old friend of this publication).
It seems that almost every shady offshore firm has been taking advantage of Quilter and other life offices just like them being asleep at the wheel, with hordes of unlicensed investment firms popping up with increasing frequency and success in virtually every expat jurisdiction (especially Spain: e.g. Darren Kirby and Jody Smart at Continental Wealth Management).
Quilter are (at least partially) to blame. The well-known asset management company’s lack of responsibility when it comes to selling inappropriate products to any suitor who comes a-calling is – at this point – bordering on criminal negligence. (And that’s if you remove the border…)
Quilter are fully aware that the statistics they’ve obtained (£30,857,329 lost to UK pension scams since 2017) are downright misleading. They fall woefully short of demonstrating even the losses incurred by their own (Quilter’s) facilitation of financial crime in recent years generally – and the last three years particularly.
‘Tip of the Iceberg‘ indeed! Even the Titanic was given some sign of the peril hidden in the depths of the Atlantic as it hurtled to its certain and untimely demise!
Yet when it comes to financial fraud and investment scams (particularly those that involve unsuspecting clients’ pension pots), there is almost no pre-emptive warning given to the public, except for massively underestimated figures produced by the very people who have been clearing the way for the scammers from day one. And by that, I do – of course – mean the life offices (like Quilter/OMI) themselves.
I would like to take this opportunity to quote Jon Greer, who is the Head of Retirement Policy at Quilter. Mr Greer said: “We are entering a period of considerable economic uncertainty, and one in which generating a decent return on your investments will be extremely challenging. This is the ideal environment for scammers to thrive and it is no surprise to see huge amounts of money still being lost each year at the hands of criminals.
The fact that it is so hard to investigate and prosecute pension scams is effectively handing pension scammers a get out of jail free card. If you are mugged, it’s highly likely that the police will investigate, but lose your life savings to a pension scammer and your odds don’t look good.
– Jon Greer, Head of Retirement Policy @ Quilter
“Pension scams and other investment frauds are extremely complex, they can span multiple jurisdictions, and can often go uncovered for years before the victim realises their money is gone. This all makes investigating the scams incredibly time-consuming and expensive, which is why the police have to prioritise those few cases where they have a chance of success.
“The government have taken action on unsolicited pension calls with the ban on cold calling, but scammers are sidestepping the legislation and moving online. Movement on the regulation of search engines and social media platforms has been painfully slow and the regulation has failed to keep up with the evolution of scammers.
He went on to add, “The legal deterrent appears to be ineffective, so more must be done to prevent scammers from operating, and to do this we must cut the line of communication between the scammers and their victims: search engines and social media.
“The government has a perfect opportunity to bring the regulation into the 21st century by including financial harms within scope of the forthcoming Online Harms Bill. This will mean that, for the first time, search engines and social media platforms will be bound by a statutory duty of care to tackle harm caused as a result of content or activity on their services.”
“In doing so, search engines and social media providers will be legally required to remove suspected scammers immediately on notification, and not allow them to operate in the first place, or face sanctions from the new regulator,” he said.
As you can see Mr. Greer, and by association Quilter, talk a good fight and hit on almost every relevant point a consumer would want to hear from a company of their standing and stature within the financial industry; projecting themselves as a shining light – pouring their beacon out over the surrounding landscape and frightening any existing/would-be scammers out from their hiding places, while at the same time calling on the government for harsher penalties and swifter action to be taken (measures which Quilter themselves, and companies just like them, have blocked on numerous occasions).
And all this “bright light-shining” has served its purpose: leaving regulators, government and public alike too dazzled to notice the wrongdoing going on behind the source of the so-called light and within Quilter‘s very own doorstep!”
The narrative that Quilter/Old Mutual/OMI would have you believe is a ridiculous one, one of the main reasons I have written this piece is to challenge that narrative; and hopefully make you (the reader) think about a company that damns financial fraudsters and scammers alike with one hand, while secretly feeding them with the other.
The grim reality is substantially different from the one that Quilter aim to project for themselves. That being said, it makes my reply to J. Greer’s well put comments even easier:
“Actions speak louder than words, and all we’re hearing is a deafening silence. If you truly believe the message your company has spent tens, if not hundreds, of thousands of pounds to tell us – by buying article space from any major financial publication that would have you, and getting them to run the story you wanted to put out there.
It’s time to put your money where your mouth is, quite literally; and begin funding the financial education sorely needed in schools and workplaces throughout the country that will serve to prevent the kind of investment-based crime you claim to stand against!
“Oh and maybe, just maybe, improve upon your company’s policies so that you do not sell the very products that facilitate thieves who have stolen hundreds of millions of pounds by misselling those same products in just the last few years, whilst simultaneously trying to absolve yourselves of any blame.
“To put it simply: don’t take your definition of “action” from Action Fraud…”
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