- Former directors of Designed 4 Life Ltd buy client data from liquidator
- Can old client’s expect a call?
- FSCS pays out over £500k for Designed 4 Life Advice
- Are you entitled to make a claim?
The former directors of liquidated advice firm Designed 4 Life have bought the company’s client data from the liquidator, despite over £500,000 being paid out in FSCS claims over issues with the advice the company provided.
The fact that the FSCS has picked up the tab for compensation payments on behalf of the company, raises the question of how the former directors were able to buy the client data, with the phrase “phoenixing” appearing in articles and comments in the adviser community
Phoenixing is the name given to the “practice” of going into liquidation, only to pop up again later practicing in a similar field, leaving the FSCS to pay out on claims made against the old company. Given that the FSCS is funded by levies paid by other advisers, you can imagine this doesn’t sit well with those in the industry who play by the book if their suggestion proves to be correct.
Designed 4 Life Ltd were found to have given unsuitable financial advice at least 3 times by the Financial Ombudsman Service, where the client had been advised to transfer their pension into a SIPP (Self-Invested Personal Pension) in order to make investments in unregulated and high risk overseas property scheme; Harlequin Properties. Harlequin has been troubled for some time, with part of the company entering into insolvency proceedings in 2017.
With the sale of the client data to the old directors, can former clients of Designed 4 Life ltd expect a contact from a new firm? Time will tell, but unless clients ask questions, are they likely to know?
Wider pension mis-selling scandal
These 3 completed FOS decisions, as well as the over £500k paid out by the FSCS since the firm stopped trading arguably makes Designed 4 Life Ltd another part of the wider pension mis-selling scandal, where ordinary people received unsuitable advice to move to SIPP and SSAS schemes to invest in potentially volatile, high risk and ultimately unsuitable investments, for which large commissions and fees were often paid to the advisers and marketing firms.
Get Claims Advice remains and the forefront of the fight against negligent financial advice, and you can read more about how SIPPs and Investments are mis-sold on our dedicated page, which offers a free and no obligation check to see if YOU were mis-sold.
Get Claims Advice are a leading CMC team specialising in pension mis-selling cases and winning compensation