Victims of a £13.7m pension cold-calling scam network have spoken out about the impact their losses will have on their lives and their regrets at being lured by promises of cash up front and market-beating guaranteed returns.
Three victims have spoken out about their experiences, describing a future of uncertainty, regret and financial struggle.
All the victims have chosen to remain anonymous. One, a man from South Wales who had given up work to care for his seriously ill partner and their three children, had almost £50,000 taken from his pension pot by the scammers. He says: “I should have known that it was too good to be true. I should have sought advice and asked more questions, but I didn’t.
“The loss of my pension will have a massive impact on my life. When my children finish school I will be around retirement age. There will be no money to draw down when I turn 55 and no pension savings for later life.
“I was greedy. I feel stupid for throwing away my financial future for £4,200.”
A couple from Hereford transferred their pension into the scam. Their pension provider warned them that they believed the transfer could be pension liberation fraud, but the leader of the scamming team, Alan Barratt, convinced them to carry on, saying they would get a lump sum as commission for transferring their funds.
The couple then transferred a total of more than £78,000 – receiving £11,800 as their “commission”. While they had been assured the funds would be invested in low-risk investments, they were sent details of a truffle trees firm in the West Country.
The couple were so concerned they contacted police. HM Revenue & Customs later contacted the couple to tell them the “commission” had come out of their pension – and handed them a tax bill of thousands of pounds.
The man, who is aged 46, said: “As a result of my dealings with Alan Barratt my final salary pension is in a scheme that I don’t understand the status of but which I have been told is a scam.
“As far as I know, the majority of my pension fund is invested in truffle trees but I doubt whether that is legitimate. My partner appears to have lost her pension too.
“I deeply regret ever listening to Mr Barratt.”
One man from Hull thanked ReAssure for refusing to allow the transfer of his £50,000 fund, although another provider did permit £17,000 he held in another pot to be transferred to Spain-based Select Pension Investments.
Between November 2012 and September 2014, 245 victims were cold-called or lured by a series of scam websites and persuaded to transfer their pension funds into one of 11 scam schemes run by David Austin installed Alan Barratt, Susan Dalton and Julian Hanson. The four have been ordered by the High Court to repay the money to the victims of the scams.
The victims were told their pensions would be reinvested and they would be paid an upfront cash lump sum for making the transfer. They were also lied to that their funds would be put into assets, bonds and HMRC-compliant investments to meet the target return of 5 per cent growth a year.
The victim said: “If ReAssure had allowed my pension to be transferred it would have been a disaster. I would have lost everything. I have had a very lucky escape.
“My wife and I were council tenants so Susan Dalton should have realised that we did not have lots of money and that our pensions were an important source of income to us. She totally misled me into transferring my pension and paid no regard for my financial wellbeing.
“She told me what I wanted to hear and I believed it. Looking back now, everything was basically a lie or a betrayal. I was naive. I was conned by a professional con merchant.”
The scammers used false documents to trick staff at the ceding schemes into believing that the pension holders worked for companies linked to the scam schemes.
More than £1m was paid to “introducers” or “agents” who used cold-calling to encourage pension members to transfer over their funds.
More than £10.3m was transferred to businesses owned or controlled by Austin, including the current accounts of Friendly Pensions Limited and Friendly Investments Company Ltd. Austin, a former bankrupt who had no experience of running an investment company, used the bank accounts of his dead father-in-law and his elderly mother-in-law to move around hundreds of thousands of pounds. Barratt was paid £382,208, Dalton more than £168,000 and Hanson £7,000. Hanson’s scheme had become active only weeks before the scam was stopped. The High Court found that on the available evidence, Austin and his family had derived at least £1.355m of benefit from the scam.
Just £3.2m of the funds was invested. Among the investments were £2m in an off-plan hotel development in St Lucia called Freedom Bay and an unregulated commercial property bond. £120,000 went to a company registered to Mr Austin’s daughter, Camilla Austin, to fund her father’s legal costs in a separate case.
A whistleblower contacted TPR about the scam in November 2014. TPR then appointed Dalriada as an Independent Trustee to take over the running of the schemes.
Austin laundered funds from the schemes into his bank account and the accounts of family members in the UK, Switzerland and Andorra through a number of businesses that he had set up in the UK, Cyprus and the Caribbean, including FPL. TPR, which prosecuted the case, showed the High Court evidence of how members of Austin’s family had lived a life of luxury using the money – including showing off their spending on expensive goods, ski holidays and trips to Dubai and the Mediterranean on social media sites.
TPR executive director of frontline regulation Nicola Parish says: “The High Court’s ruling means that Dalriada can now go after the assets and investments of those involved to try to recover at least some of the money that these corrupt people took. This case sends a clear message that we will take tough action against pension scammers.”
