Members will be aware that the previous trustee invested their pension pots into a number of non-mainstream investments. One of these, the Para Sky plantation operated by GFI Consultants Ltd, was clearly fraudulent with the monies clearly being lost.
Another investment was much smaller: a series of 20-year loans made to a company named Green Asset Solutions Ltd to help finance the purchase of solar power equipment that in turn was leased to Welsh local authorities. Whilst this investment was made by the former trustee with no recourse to members whatsoever, the company and its proposition appear bona fide to us and it continues to make interest payments without issue. The nature of the investment is one that would lend itself to larger pooled pension funds such that we accept the company borrowed these monies in good faith. These loans are relatively small (c.£300k in total) such that we will not be seeking ways of liquidating it until we are firmly in the process of liquidating the schemes’ largest outstanding investment, the Ecoquest Plc Debentures.
The previous trustee invested some £5,249,000 in these Ecoquest Plc Debentures. They were due to mature on 30 November 2017.
As further updates have explained previously, Ecoquest abandoned its business plan after making an investment of its own into the fraudulent Para Sky Plantation. It subsequently turned its focus to recovering these monies through a tracing action, but to date has remained unsuccessful.
Its principal shareholder then responded to this issue by contributing substantial other assets to Ecoquest to try and make good any shortfall. These assets are however unlisted shares; and the ability of Ecoquest turning these into cash in order to redeem the schemes’ bonds depends on these shares being formally listed on the main stock exchange. Ecoquest tell us that matter is still pending and there is yet to be a firm timetable for this.
In the meantime, Ecoquest have now filed their audited accounts at Companies House. You can click here for a copy. These state that Ecoquest has sufficient assets to redeem the debentures, albeit in due course. It has assets worth £9.8m on its balance sheet (“Statement of Financial Position”) relative to liabilities of £7.1m, giving a surplus of £2.7m.
The nature of these financial statements, having been subject to statutory audit, lead us to continue believing that we will eventually recover at least the bulk of these monies, and that our approach to winding up these schemes (through first awaiting to collect in the assets) remains in the best interests of scheme members.
Nevertheless, these debentures are now technically ‘in default’ and our inability to turn these into cash for the foreseeable future means that we are unable to pay transfer values for members equal to the face value of their pension pots. To this end, our advice at this stage to members whose pension pots were invested in this way is to follow the work we have previously undertaken and to make claims with the Financial Services Compensation Scheme (FSCS) in respect of the financial advice you were given by your IFA firm.