Global Forestry Limited was an investment in two Teak tree plantations in Brazil, known as Belem Sky and Para Sky. This was marketed by GFI Consultants Ltd as an ethical and sustainable investment, in which investors purchased plots of land starting from £5K with promised returns of at least 10% per annum.
In 2013 the company was placed into compulsory liquidation. Investigators working for the Insolvency Service reportedly found that despite collecting £24m in investments, Global Forestry Investment Ltd had only paid out £710K to investors.
These types of investments are not only high risk, but also unregulated meaning no protection for investors should things go wrong. It’s usually only people who understand the risks and the potential losses, that are suitable for this type of investment.
Many people became invested in Global Forestry as part of their SIPP pension, often on the recommendation from a financial adviser.
Mis-selling, in respect of pensions and investments, is largely based on suitability and due diligence. The financial product being recommended must be suitable for the customer. This is based on factors such as attitude to risk, understanding of how the product works, as well as the investment itself.
All UK regulated companies, such as Advisers and Pension Providers, are subject to strict guidelines and rules. If they don’t stick to them, not only could they be exposing their clients to unsuitable risk, but this may be mis-selling.
Whilst each case is individual, as mis-selling specialists we know to look for certain signs that in our experience indicate that mis-selling may have happened.
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