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spygirl

SIPP fraud thread

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Just something that I keep hearing about all the time now.

Theyve been kicking around for years and are a good idea for  people with 200K+ of pension and who understand what they are doing and have access to good, paid advisors.

For the other 90% they are a fucking disaster and the level of scams has gone hyper since 2006ish.

http://www.bournemouthecho.co.uk/news/15269367.Ethical_Forestry_investors_urged_to_seek_compensation_as_collapsed_scheme_is_sold/

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Dodgy investment schemes will always be with us. I worked, in a very minor capacity, on the Barlow Clowes "bond washing" investigation after it collapsed in 1988.

Then there were the ostrich farm "investments" of the 90s: "Have you ever thought about investing in an Ostrich Farm? Why not?" ran the adverts.

And in the 00s the boiler room pump and dump schemes, one of which I played along with to see the technique.

I dealt with the Lloyd's spiral collapse (minor role again) where the most common defence from the underwriters for having bankrupted all those wealthy celebrities was "We didn't understand what we were writing." Which was true.

Then there was old red faced Brighty up at Independent Insurance, literally hiding claims in the bottom of his wardrobe. I'm rambling.

Although I did work with the world's champion bullshitter. He was way junior to me but somehow got put in charge of a Belgian insurer, investigated by the Belgian authorities when it soon went bust with all the money vanished and found to be backed by the Yakuza. This same bloke fled Kenya whilst being tried for fraud charges last year.

 

Anyway - my point is that dodgy and fraudulent schemes are always with us.

But there is nothing intrinsic to SIPPs that makes them any more vulnerable than an ISA or even a bank account come to that.

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So what sort of investments could provide proper long term pensions the money they need?
Council style housing? Nah it gets trashed by scummers and then needs completely redoing.

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12 minutes ago, sarahbell said:

So what sort of investments could provide proper long term pensions the money they need?

BTL! ;)

Edited by DeepLurker

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9 minutes ago, sarahbell said:

So what sort of investments could provide proper long term pensions the money they need?
Council style housing? Nah it gets trashed by scummers and then needs completely redoing.

If you mean in a SIPP for yourself them some global managed equity fund would be the safe long term option.

Or do you mean backing bigger schemes like LGPS? If that then social housing (mostly) works fine as you have endless demand and a government-underwritten income stream.

Very very few houses get seriously trashed which is why they often hit the papers when they do, most are looked after reasonably.  I'm guessing but maybe 1%.

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25 minutes ago, MrPin said:

Frank's wellllll dodgy! Ostrich farms indeed!o.O

Insurance and investment schemes attract fraudsters because you get the money in up front and are then trusted to pay it out later.

One Lloyd's Syndicate was stupid enough in the 1980s to reinsure it self with the Government of North Korea. Not a state insurance company, just writing a cheque to the government.

Needless to say when they claimed upon it they never got any money back. Who'd a thunk it?

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1 minute ago, Frank Hovis said:

Insurance and investment schemes attract fraudsters because you get the money in up front and are then trusted to pay it out later.

One Lloyd's Syndicate was stupid enough in the 1980s to reinsure it self with the Government of North Korea. Not a state insurance company, just writing a cheque to the government.

Needless to say when they claimed upon it they never got any money back. Who'd a thunk it?

If it's too "good to be true", it probably is!

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2 minutes ago, MrPin said:

If it's too "good to be true", it probably is!

Generally yes, but there are some cracking legit ones.

Solar panels before the FiT rate dropped (14% return, tax free and index linked, even before you bring in the savings in your bill)

Tax relief on SIPPs and VCTs.

The government keeps coming up with these things so it makes sense to pile in when they make them so attractive.

They've clearly indicated that diesel scrappage is on the long term agenda, even if the opening version is a bit rubbish, so I'll hold onto my car until it's down to £500 and then magic an extra £1,500 out of for my next one. Timing.

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32 minutes ago, MrPin said:

If it's too "good to be true", it probably is!

This is the rule of thumb I always advise people, trying to explain to them risk v return can get complicated for a lot of people, but the 'if it's too good to be true' line actually is understood by most people

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1 hour ago, Frank Hovis said:

Then there were the ostrich farm "investments" of the 90s: "Have you ever thought about investing in an Ostrich Farm? Why not?" ran the adverts.

I used to know the SA guy that started that..well selling the eggs at £4k a pop ...fuck me there are some dull people out there ..it was also his view  .

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52 minutes ago, Frank Hovis said:

If you mean in a SIPP for yourself them some global managed equity fund would be the safe long term option.

Or do you mean backing bigger schemes like LGPS? If that then social housing (mostly) works fine as you have endless demand and a government-underwritten income stream.

Very very few houses get seriously trashed which is why they often hit the papers when they do, most are looked after reasonably.  I'm guessing but maybe 1%.


Well as an option to for people to 'invest' their money in.
It seems silly to allow money to go to nonsense schemes. My concerns would be on how they are managed and how much the staffing costs end up being once you stick a council mentality on things. 

They'd have to be built to the highest eco standards that make financial sense - perhaps not all passivhouse levels but close. 
 

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4 minutes ago, sarahbell said:


Well as an option to for people to 'invest' their money in.
It seems silly to allow money to go to nonsense schemes. My concerns would be on how they are managed and how much the staffing costs end up being once you stick a council mentality on things. 

They'd have to be built to the highest eco standards that make financial sense - perhaps not all passivhouse levels but close. 
 

The council mentality is actually spend the bare minimum; this is why there was a huge raft of transfers of council house stock to housing associations as the council stock through years of skimping on the maintenance was in a shockingly bad state.

The eco stuff falls into vanity project territory. Passivhauses and air source heat pump are great in theory but they cost a lot and only work if people use them properly. If they don't (and many to most don't) then you have wasted your money. I would actively dislike living in a passivhaus and would probably end up opening the windows as the tenants do but you're not meant to as it stops it working.

Standard traditional build houses are still the best option financially.  They will last for a hundred years without substantial structural maintenance being required. I dread to think what state a passivhaus will be in in fifty years.

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1 hour ago, DeepLurker said:

BTL! ;)

Many a true word spoken in jest. I think a lot of people who put their money in property do it because they're terrified of being ripped off if they go for shares, bonds etc. It's interesting to read how mid-rank celebs invest their money (it would also be interesting to hear how mid-rank corporate execs do it but the newspapers don't interview them). The question of "where do you put you money" is invariably answered with "property, I don't understand shares and stuff". 

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1 hour ago, Long time lurking said:

I used to know the SA guy that started that..well selling the eggs at £4k a pop ...fuck me there are some dull people out there ..it was also his view  .

Chicken eggs are not much. An ostrich egg must be worth £2. I'm not sure if an ostrich is hard to keep. I bet you need a big garden!

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9 minutes ago, MrPin said:

Chicken eggs are not much. An ostrich egg must be worth £2. I'm not sure if an ostrich is hard to keep. I bet you need a big garden!

Aye, but they also like lots of long grass to hide in.

I've heard that Terry Waite bought a couple...

 

XYY

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35 minutes ago, The XYY Man said:

Aye, but they also like lots of long grass to hide in.

I've heard that Terry Waite bought a couple...

 

XYY

Long grass? The fuckers are six foot tall! Maybe it's that South American pompous grass?o.O

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3 minutes ago, MrPin said:

Long grass? The fuckers are six foot tall! Maybe it's that South American pompous grass?o.O

Is that the kind of grass that likes to you give you a long lecture on how important it is?

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Just now, TheBlueCat said:

Is that the kind of grass that likes to you give you a long lecture on how important it is?

:)

The purple pussy got you good and proper there mind Pinny...!

 

XYY

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Just now, TheBlueCat said:

Is that the kind of grass that likes to you give you a long lecture on how important it is?

I've always wanted to grow some.

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No. I think the SIPP thing goes beyond greedy people putting a few grand in Ostrichs.

A lot of the advise seems to be bent as bent,

These IFa were all encouraging people to cash out pension fund - so normally several 10s of K into unregulated schemes:

- Individual hotel rooms - see Skelwth/Grosvenor IA of York.

Storepods:

http://www.international-adviser.com/news/1035260/uk-ifa-banned-advising-clients-invest-gbp12m-storepods

The number of scams, the number of investors and the scale of money lost surely must mean that SIPPs are close to being shutdown or at least limited in scope.

Edited by spygirl

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One of the problems is that the trustees of the SIPP are supposed to do a certain amount of due diligence on the investments being held in the SIPP - some don't bother and won't if they are bare trustees so people do get done over. I've dealt with SIPP providers and the smaller ones - I wouldn't touch with a barge pole. 

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1 hour ago, Dipsy said:

One of the problems is that the trustees of the SIPP are supposed to do a certain amount of due diligence on the investments being held in the SIPP - some don't bother and won't if they are bare trustees so people do get done over. I've dealt with SIPP providers and the smaller ones - I wouldn't touch with a barge pole. 

I think some of he SIPP wrapper people are in cohoots wit the dubious IFa selling scam schemes.

I think they are giving data of their clients over to the the scamsters.

 

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