Have You Lost Money Investing In The Resort Group?

We may be able to help you recover your Fractional Ownership losses from IFAs!

The Resort Group offered investors the opportunity to invest in luxurious hotel rooms either in full, or in part via their “fractional ownership” programme. The investment was endorsed by high profile celebrities, which in turn attracted numerous third-party pension providers and Independent Financial Advisors (“IFAs”) to try and persuade their own clients to invest. However, because fractional ownership was non-standard and complicated the investment was unsuitable for the average consumer.

What is “Fractional Ownership”?

Fractional ownership, also known as timeshare, is usually a partial or full investment in a hotel room or apartment that enables the buyers to purchase the right to occupy property during specified periods. Investors were told they will recoup their money from the income generated by guest occupation, or when the room or apartment is sold at a later date. As well as The Resort Group, a number of other companies are known to have sold fractional ownership products including Club La Costa and Diamond Resorts. Silverpoint Vacations SL also sold a product called a “Company Participation Scheme” which has all the hallmarks of a fractional ownership product. Problems arose with the investments when no income was generated or the property could not be sold.

Investors in these products were likely to be offered a combination of either a number of weeks’ holiday each year at the resort in which they have invested and /or a dividend based on the profits obtained from renting the unit out each year. The investment is often held within a company, whom it claims will acquire the full title to the unit within a given number of years, at which point it is often claimed that the unit can be sold on the open market at a profit.

What is wrong with these types of investment?

In short, they are problematical because they too complicated.

It is likely that the property in which the investment takes place is based overseas and may or may not have already been built. In some cases, the investment that consumers make may not be secured on the property that they are investing in but may give the resort the option to spend the money as they see fit. These investments are typically illiquid and often unregulated, which means that it is difficult to recover your investment should you want to sell.

Who is to blame for investors losing money?

IFAs should not sell problematical and complicated products to everyone.

The losses suffered were in respect of the actions of IFAs and the pension providers who acted separately to The Resort Group.

Often, the IFA or pension provider cold called the consumer offering free pension reviews. The true purpose of the call was to promote The Resort Groups planned resort developments in Cape Verde. The pension review is often undertaken by an unregulated business who were attracted by high commissions. In turn, in some instances, consumers’ pensions (which were safe and secure) were replaced by a risky investment via a SIPP.

Regulated IFAs should not have been promoting this type of risky investment to non-sophisticated investors. They should not have been advising consumers to surrender their existing pension plans in order to invest in this company via a SIPP. In the alternative, the SIPP provider themselves can be held accountable, as they should never have allowed such an investment to be held under their governance, which would have prevented the IFA from promoting “fractional ownerships” in this company.

The message we are sending is that these types of investments are complicated, unregulated, and unsuitable for many, and that IFAs should not have been promoting them. If you have been advised by an IFA to invest in the Resort Group via a SIPP then please contact us.

How can we help you?

Lincoln Green Solicitors Ltd have successfully recovered monies in investments of this nature over many years, and our team are experts in mis-sold investments along with products that relate to the timeshare industry. Our knowledge allows us to provide you with the option to appoint our solicitors to represent you under a “no win no fee” agreement, which means that we won’t charge you any upfront fees for pursuing a claim.

For more information, please call us on 0300 303 3819