Apollo Pension & Investment Advisers asked to pay compensation to three clients over ‘unsuitable’ SIPP advice after Green Oil Plantations investments

One such case involved the pension transfer of a man with degenerative neurological conditions, who later died.

Regulated IFA, Apollo Pension & Investment Advisers has been asked by the Financial Ombudsman to pay out compensation regarding 3 cases where the FOS adjudicator decided that their pension advice was unsuitable.

In each of the 3 Ombudsman cases, which were published between Feb 2015 and June 2016, the clients used advice from Apollo Pension and Investment Advisers to transfer their pensions into SIPPs (Self-Invested Personal Pensions), which later were used to invest in the same UCIS Investment – Green Oil Plantations.

Green Oil Plantations Investments

Often referred to as GOP by investors and the Financial Press, Green Oil Plantations investments involved the purchase of a crop of Milletia trees in Australia, which would be harvested after about 2 years of growth to then produce supposedly ‘sustainable’ products such as biofuels and livestock feed/fertiliser.

While that all sounds well and good, Green Oil Plantations was also a UCIS investment – unregulated by the Financial Conduct Authority. This status meant that when GOP went into administration in 2013, investors had no direct access to the Financial Services Compensation Scheme to recoup their losses.

Generally speaking, to be deemed suitable for such a high-risk investment, potential investors should be:

• High Net-Worth Individuals (earning over £100,000 per year or with £250k or investible assets, not including their primary residence or pension)
• Sophisticated investors, fully informed of the risks that that particularly market represents, and how to navigate them.

3 Cases of unsuitable pension advice

While each case involved unique elements, in all 3 cases listed and upheld by the FOS, the complainants:

• Said that Apollo advised on both the SIPP and the underlying investment
• Had taken SIPP advice from Apollo from an adviser that was also an agent for GOP
• Were judged by the FOS adjudicator NOT to be Sophisticated Investors
• Were judged by the FOS to be unsuitable for each investment.

Apollo Pension & Investment Advisers denied they provided advice on the investment, however the rebuttal from the FOS was that “In my view, it was not possible for the adviser to give suitable advice to recommend the SIPP without considering the investments that would be made in the SIPP”, and that “The separate unregulated business was also owned by the adviser from Apollo”.

Mr T – DRN9116719

Mr T’s case has been highlighted in this blog because of the questions it raises:

“In 2007, Mr T was diagnosed with a degenerative neurological condition for which there was no treatment available. By 2012, when the advice was given Mrs T has said that Mr T’s condition was rapidly declining. He died in 2015.”

Mrs T dealt with the ombudsman case on his behalf.

As of 25.01.2017, Apollo Pension & Investment Advisers reamainsl regulated, authorised and seemingly open for business.

References:
Ombudsman Decisions:

DRN6388596

DRN5742370

DRN9116719

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