Equity release enables scams – urgent actions called for

KwikChex is seeking assistance from loan providers, advisors and authorities after uncovering a multimillion-pound fraud enabled by equity release. 

KwikChex is helping consumers who fell prey to a purported real estate and holiday club investment scheme. Many of those affected were persuaded to remortgage their homes to invest in what was called Global Great Hotels’. 

After being approached by persuasive salespeople while holidaying in Majorca, they were told that the Global Great Hotels scheme would provide multiple benefits, from ‘free’ holidays, to exceptional investment returns. In fact, the products being sold were really just disguised timeshares. Most of the ‘investors’ paid over 100,000 Euros and some have paid over half a million Euros.  

To enable the payments, they were introduced to a regulated mortgage advisor, who enthused over the product, prior to arranging equity release loans with several respected lenders. The scheme included many promises of benefits that have not been kept, and ceased suddenly altogether at the end of last year, leaving the investors distressed and in harsh financial circumstances. 

KwikChex CEO Chis Emmins, who has talked with many of those affected, said, “This is a particularly nefarious scheme, even in a world currently riddled with scams. Most of it would not have been possible without the attached equity release element, and it has had a terrible impact on people that are moving into, or already in retirement. The ease with which major financing was provided against the value of family homes for something that was unquestionably unlawful needs an immediate examination of safeguarding processes – which in this case were shown to be non-existent.” 

KwikChex has previously seen equity release being used to enable substantial frauds, including financial investment, and so-called ‘romance scams’, but this is the most serious and blatant example yet, and substantially involves a regulated financial advisor. Aside from helping the victims, KwikChex will be contacting advisors, lenders and the relevant authorities to request greater due diligence when arranging such impactful loans. 

A Facebook group has been created by many who have been affected by the Global Great Hotels scheme, with over one hundred already sharing information and getting assistance, but it is believed that possibly thousands are affected – this is the link to the group

https://www.facebook.com/groups/249746151101205/ 

KwikChex has provided more information on the following link

Investors seeking to reclaim millions over Global Great Hotels failures 

Post by Editor