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Losses reported by investors involved in The Resort Group

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FT Adviser recently reported on losses incurred by investors involved in The Resort Group (TRG). Customers invested in the luxury hotel complex. They are now worried about their investments as returns are not as high as they initially expected.

Why are The Resort Group investors concerned?

When customers initially invested in TRG, they were promised high returns on their investments. One marketing brochure promised 20 percent annual returns on the apartments. TRG’s own website speaks of five to seven percent returns and a regular income through its hotel management scheme.

However, investors are reporting that they’re losing money due to low returns and high fees and charges from their self-invested personal pensions (Sipps). They are also concerned about liquidity of the investments as they’re struggling to sell the hotel rooms for a profit.

For example, one investor had a projected gross annual income of £4,500. According to his latest Sipp statement, he received £520 from The Resort Group in tenant rent in 12 months and faced Sipp fees of about £655, leading to an overall loss.

APJ’s stance on The Resort Group

Glyn Taylor, one of our expert solicitors was quoted in the FT Adviser article. He puts the blame on the way products were marketed. It made investors believe they would be getting higher returns on their pensions than they have actually received.

He also believes that Sipp providers should never have accepted the investments onto their books. They should have taken reasonable steps to ensure they could undertake realistic annual valuations. If the investment is high risk and illiquid, as in the case of The Resort Group, then it shouldn’t be accepted as it is inappropriate for a Sipp investment.

Ultimately Sipp providers need to accept that they have responsibility for the investments that are allowed into their portfolios.

If you believe you’ve invested into a scheme and lost money due to bad advice, our financial mis-selling solicitors can help you to secure compensation. Contact us today to find out more.