"A complete sham": The airport parking scam that's after your pension
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Thousands of British savers are being conned out of millions of pounds in a wave of 'airport parking' investment scams designed to part them with their pension cash, The Mirror can reveal today.
Both the police and the Financial Conduct Authority have been dealing with an avalanche of cases of unscrupulous financial advisors preying on investors with phantom 'get rich quick schemes' for them to retire on.
And airport parking spaces - in which investors are promised high returns - is one of the new ways arch advisers are trying to con savers out of their pension pots.
It comes after the government recently introduced reforms giving people more freedom over their retirement cash.
Buy a parking space - and rent it out for thousands
(Image: iStockphoto)
Many middle-aged workers are now being targeted by cold call ‘fixers’ who advise them to move their retirement savings into Self-Invested Pensions Plans (SIPPS) which include rogue investments such as airport parking.
They are then sold parking spaces at £25,000 a time at various airports around the UK under the guise that they can then lease it out to a tenant for a period of time.
Often this tenant is a management company which then sub-leases it to customers on an annual basis and they are promised a rental yield of 8%.
However, the majority of cases are being found to be false. City of London police have been alerted to a series of alleged scams as have other police forces across the UK.
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The UK’s leading claims expert Rob Ridge, said: "The freedom for members of the public under the recent pension changes are a good thing, but the lure of available pension money is attracting unscrupulous fraudsters.
“Investors should be wary of cold callers offering to move your pension into SIPPS and investments that sound too good to be true, because usually they are. Thousands of hard working people are now losing their life savings in these schemes and are falling victim to very bad investments like the airport parking cases we have found."
Action Fraud said it had identified the trend where members of the public receive unsolicited calls from forceful sales people offering an opportunity to invest or promoting the parking spaces as a 'sound pension investment'.
Sales people offer verbal and written promises of a guaranteed and questionable high rate of return on the investment.
They also offer a buy-back scheme when investors want to sell their parking spot on; however there is no guarantee of an onward sale or that there will be any potential buyers when they come to sell.
Be wary of anything that's too good to be true
(Image: Getty Images)
Financial and legal experts have warned people to be wary of putting their retirement savings in niche investments which can be hard to exit and come with hefty fees.
The National Fraud Intelligence Bureau said: "A new commodity is being offered as an investment to members of the public. This new commodity is parking spaces. The method used by those selling the parking spaces is very similar to that used by businesses selling unregulated investments including diamonds, wine and carbon credits."
It added: "Post investment, the consumer may find it difficult to contact the investment company to discuss their investment or reap any financial returns.
"The cold callers may be acting as estate agents and seeking to sell parking spaces owned by another. If the company offering the investment is not a registered estate agent then caution is advised."
Ridge, whose company Money Redress is the UK’s main investment mis-selling claims specialist, said: “SIPPS are now available for the masses - to retail customers and not just sophisticated investors. And unfortunately as a result of this many working class people are mis-sold investments - it is criminal what is happening and it becoming more and more prevalent.
“We have seen a huge rise in investors coming to us saying they have been tricked into investing in these airport parking scams.
“These cold callers say that you are welcome to buy a car park space (similar to buying a house) and we will manage it for you - and we will rent it out for you and you'll receive a slice of the revenue. They will offer you a yield of roughly 8 per cent for the year.
“They offer you the airport parking space saying it is similar to buying a house as an investment. But this is not true at all, when buying a house, you see bricks and mortar, but with car park spaces it is difficult to prove what you own.
“In these scams the victim has cashed in their brass plated work based pension and transferred say £60,000 and bought two car parking spaces with the expectation of an 8% return each year. He or she also expects his £60,000 at the end of 10 years. Unfortunately, this is not happening and they get neither. These people are losing out."
"We are seeing at Money Redress that these investments are a sham - they are phantom investments. More often than not these poor investors will not get their pensions back."
Many victims are now successfully starting to recover compensation for their lost pensions through the Financial Services Compensation Scheme and with the help of the Financial Ombudsman.