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Over the last 15 years or so there has been an increase in luxury Resort hospitality companies forming and creating 5-star holiday Resorts and Hotels. Many of our claimants bought hotel development stares from the ‘Harlequin Group’ and ‘The Resort Group’ amongst many others.Investors have been taking money from private investors, often in the form of a SIPP and placing in these groups on the promise of a high return, without explaining the risks. However, many of these companies are a very high-risk investment as they sit outside the jurisdiction of the Financial Conduct Authority (FCA).
Shares in these companies were also sold to people they were not suitable for. If you have invested in one of these developments, your money is not protected. If the company was to collapse or liquidate, you are not protected by the Financial Ombudsman Services or the FSCS.
Many of the development groups failed to complete or even begin building the majority of their sites and have gone into liquidation.
You were mis-sold an investment in a Hotel Development if:
- You earn less that £100,000 per year
- You are not an experienced investor
- The risks were too high for your needs
Financial advisers are under an obligation to ensure that investors who they sell these schemes to are of high net-worth. They must be told about, and understand, the high-risk nature of overseas investments. Advisers also, should not be recommending schemes that are not regulated by the.