MC Trustees fearful of esoteric investment popularity

MC Trustees is concerned about the popularity of so-called esoteric investments and their impact on investors and Sipp providers. Joy Smith, business development and marketing head, said the firm was inundated with applications for "weird investments." These included non-UK investments such as forests in Thailand and very long-term investments which would be unsuitable for people approaching retirement.She said: "I think it's a trend, we're getting lots of calls about investing in weird investments. People see the £ signs, especially when the returns on safe investments are so low, and they are easily talked into it. We're not comfortable with them and we're not experts in this field of investment."I don't think we're alone either, if we're getting these calls then I'm sure other firms are too. People tell us they use one firm and that they want to 'diversify' to us when really they've just had the door shut on them."She said the firm was working with a consultant who formerly worked for HMRC to look out for which sort of investment are safe and which should be avoided.{desktop}{/desktop}{mobile}{/mobile}The demand was so great that MC Trustees, which has around 2,000 Sipp and SSAS accounts, would be overwhelmed if it took them all on.She said: "If we took every request we got, we would get a massive amount of business that we couldn't even cope with unless we employed more staff. Then HMRC and the FCA might start an investigation and we could be closed down. It's a very serious issue. We'd rather be careful and keep our members happy than take this business."She also said that SSASs were also getting increasingly popular due to their unregulated status."SSASs are already seeing a lot of growth because they're unregulated at the moment. They might be regulated in due course but not yet. If we reject these type of investment then people try to buck the system and use it in a SSAS instead. They tell you they can get a 15.8 per cent guaranteed return and you're thinking 'that's highly unlikely'."MC Trustees has temporarily stopped applications into SSAS as it moves from being a scheme administrator to a scheme practitioner. It hopes to re-open application in mid-September.

MC Trustees fearful of esoteric investment popularity

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