COO of Resort Group admits there is no interest in the sale of property assets
Chief Operating Officer of a luxury offshore property scheme has said investors may find it difficult to part with their assets during the pandemic.
Charlie King, COO of The Resort Group, has this month sent an email to a UK Sipp investor admitting that there is almost no buyer interest in fractional stakes in the Group’s overseas properties.
In the email King wrote:
The property is being marketed as a full property rather than its fractional parts.
At the moment there is almost no interest from our sales distribution channels for fractional properties and the few sales that are being achieved are [at] very substantially lower prices than asking prices.
The Resort Group’s property assets are being sold in two different ways – the whole hotel rooms and fractional shares in rooms. King has stated that there is a “substantial” drop in fractional values.
The email in question was directed to Nick Cannon. FTAdviser reported earlier this month that investor Nick Cannon had not gained the return on investment he had been promised. Cannon bought a 50 per cent share in a room in the Group’s Dunas complex for £56,500. He asked The Resort Group to sell the investment a couple of years ago after not receiving the returns he had expected.
The yield, Mr Cannon explained, had fallen below 2.5 per cent per annum, threatening his planned retirement. He also said he had not received any rental payments at all this year.
Cannon received a reply from COO, Charlie King, directly, which stated it would be hard to sell the property, partly due to the inability for potential investors to visit the properties because of COVID-19. Mr King added in the email:
We have also increased the asking price in order to give a guaranteed rental return for a fixed period which we believe will significantly improve the chances of finding a buyer.
Therefore the marketing is at a headline price of €200,000 (£179,400) for the property with a view to allowing some scope to consider offers.
Mr Cannon said:
I feel that Sipp providers must be accountable and be told by the FCA to immediately and independently revalue all Cape Verde/TRG properties.
Who are The Resort Group?
The Resort Group was founded in 2007 by CEO, Rob Jarrett, a former banker and financial consultant at Prudential. It owned four luxury resorts in Tortuga, Dunas Beach, Llana and White Sands. It offers overseas property investments, which were to build resorts and hotel, in Cape Verde off the coast of Africa.
2007, however, was a relatively unfortunate time to set up a company of this nature, with the crash of the financial markets in 2008. To keep investment money coming in, The Resort Group set up a convoluted system of organisations which seemed to point towards investing into their company. This included a call centre called Lifetime Connections and a pension review company called First Review Pension Services, which were both heavily linked to The Resort Group.
A 2008 marketing brochure for The Resort Group, issued by an independent partner Kayden Estates, spoke about 20 per cent annual returns on the apartments.
Many people were convinced to invest their personal pension fund into the scheme.
The company hit national headlines in 2016 after a BBC Panorama programme uncovered evidence of unregulated financial advisors giving pension advice which included a guarantee of a 10 per cent interest after a year of investment into the Cape Verde scheme.
Do I have a mis-selling claim against The Resort Group?
If you invested into The Resort Group and were not told about the high-risk nature, then you may have been mis-sold your investment, like hundreds of others.
Multiple financial advisers and the Financial Services Compensation Scheme (FSCS) have been paying out compensation to those who have been mis-sold the investment through investing via their SIPP.
This includes those who have:
- Transferred their pension to a SIPP
- Invested into The Resort Group
- Are not earning over £100k per year
- Not much investment experience
- Claimed to have been pushed into investing after heavy sales tactics
The Resort Group and their financial advisors who worked for them failed to carry out proper checks on the suitability of their investors. This has left many investors losing thousands of their savings. Does this sound like you?
How can Smooth Commercial Law help?
Have you been mis-sold a pension or investment product by The Resort Group? Smooth Commercial Law may be able to help you claim compensation.
At Smooth Commercial Law, our team of experts have experience in dealing with a whole manner of claims that arise from negligent, fraudulent and/or unsuitable financial advice, including unsuitable transfers from pensions. We are seeing an increase in claims for mis-sold pensions and unsuitable investments, and have managed to secure compensation for many of our clients.
Should you have a claim for negligent financial advice, we can deal with your case and look to recover compensation for not just your loss of investment but also any adverse tax liabilities that you may now be facing as well.