, TRG Stalls Rental Payments on Overseas Resorts, Pension Justice

UK citizens who invested their SIPP money into overseas resorts are shocked as their rental payments are delayed.

On 28 August 2019 The Resort Group (TRG) explained in a letter to its investors that rental payment had been stalled as it had to clear “certain loan commitments. The firm also added that the situation had been worsened by its lower income in the summer, which is a low season in the country.

TRG indicated that they have always paid investors their rental dues on time since 2011 and promised that they would “definitely pay any outstanding rental payments due” within the next few weeks.

This development affects those who invested in the Llana, Dunas and Tortuga Beach resorts, some of whom have reported making huge losses due to the high fees and low returns on investment as well as charges from their Self-Invested Personal Pensions (SIPP). Take a look at our things to know about mis sold pensions here.

TRG had informed investors in a letter that: “The reasons for the delay are a combination of factors that have unfortunately had a knock-on effect across The Group. As is to be expected, we always experience much lower revenues from our hospitality operations in the summer months due to the low season, and we are a quarter or so behind in being paid. Moreover there are certain loan commitments which we have to honour which has similarly had an effect on the cash balance within the business.”

One has to question the rationale of this statement. Why are certain loan commitments relevant to the passing on of rental income to owners?

A representative of TRG said “The Resort Group has not used the rental returns to pay off loans”.

TRG was founded in 2007 by Rob Jarrett and TRG own a series of luxury resorts in Cape Verde.

TRG sold hotel rooms in Cape Verde to UK investors via their SIPPs, either as a whole entity or fractional ownership in a company.

Many UK investors have invested money through their SIPPs via Rowanmoor and London & Colonial.

CIB/Real SIPP who were an independent financial advisor recommended many thousands of clients to invest in the TRG scheme in Cape Verde via their SIPPs. CIB/Real SIPP has now gone into administration and has been declared to be in default.

Rowanmoor, who are one of the main providers of SIPPs that hold TRG assets, would not say whether it planned to intervene on behalf of its clients but a spokesperson said “Over recent months we have been working closely with The Resort Group to resolve the situation for and on behalf of our pension members”.

In many cases advisors, many of whom were not authorised by the Financial Conduct Authority (FCA) recommended to clients to open a SIPP, to transfer their existing pensions into the SIPP and thereafter “invest” the vast proportion of their pension monies into the TRG scheme. This was extremely bad advice as no retail investor should hold an investment in TRG within a SIPP because the investment is unregulated, high risk and extremely illiquid.

Many clients have complained that they have simply been unable to sell their “investment” at any price as there is simply no market for these properties.

If you have been mis-sold a SIPP or provided with wrong SIPP advice, and you have suffered a financial loss as a result, contact us today by phone 0800 014 8275, email info@ppcm81.sg-host.com or via our Contact Us Page at ppcm81.sg-host.com. At Pension Justice we are dedicated to ensuring that you receive the maximum possible compensation, within the shortest possible time.