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IFA Bentley-Leek hands FSA details of property loan

by William Robins on Jun 08, 2011 at 07:00

IFA Bentley-Leek hands FSA details of property loan

Bentley-Leek Financial Management has handed over information to the Financial Services Authority (FSA) regarding a £1.3 million loan it used to shore up an illiquid property investment.

The property arm of Guildford-based Bentley-Leek took the loan after it put 142 Sipp investors into a Dubai and UK property venture that failed to deliver the intended 10% annual return. The loan was used to kick start further development of the Dubai properties.

Hornbuckle Mitchell, which provides the Sipp, said investors’ permission had not been sought for the loan.

Mustafa Dervish, managing director of Bentley-Leek, said the FSA had visited the firm in a ‘supervisory role’.

‘They asked for information and will get what they need; nothing is hidden from them,’ he said.

‘It is difficult to understand what the motives are. The FSA has come into our offices and has gone away.

I would describe it as more supervisory than enforcement. We are not saying it will not become enforcement, but at the moment that is how it is.’

David White, managing director of Hornbuckle, said: ‘We cannot comment because they are working with the regulator, but we are doing everything we can to help investors.’

18 comments so far. Why not have your say?

Evan Owen

Jun 08, 2011 at 12:08

Oh dear

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Julian Stevens

Jun 08, 2011 at 13:49

If investors' permission wasn't sought for the loan, then surely Bentley-Leek has acted improperly? What was the loan secured against and who's paying the interest? Like all other booms, the property boom in Dubai was bound to go bust sooner or later, just as it did in the UK (and Spain). My inclination is to steer well clear of booms, because by the time you find out about them, you've almost certainly missed the boat. Those who make money out of booms are those who get in before it becomes one.

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Evan Owen

Jun 08, 2011 at 13:56

This is just one of very many such cases.

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Julian Stevens

Jun 08, 2011 at 14:14

"The Regulators’ Compliance Code is a central part of the Government’s better regulation agenda. Its aim is to embed a risk-based, proportionate and targeted approach to regulatory inspection and enforcement among the regulators it applies to."

Not much notice of any of this being taken at Canary Wharf, is there?

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Mr Pederson

Jun 08, 2011 at 14:38

On a side note, anyone want to buy a property in Cape Verde?

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Evan Owen

Jun 08, 2011 at 14:55

How many more are there for the FSCS to pick up?

IFAs tell me they reported 'unregulated' schemes to the FSA years ago (so have I) and nothing was done. What is the point of all this regulation? We can't even self-regulate like we used to. How often are you offered 'SIPP Approved' investments which are nothing of the sort? Have you swallowed the bait? I'm afraid they are regulated, via your advice and arrangement of contract so if your are ruined then utlimately the ones who pay for failure are the innocent ones.

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Eden W

Jun 08, 2011 at 14:57

Cape Verde is gorgeous and I've been privileged to visit 4 of the islands over 2 trips. Things are expensive due to a lack of resources, especially water and agricultural land on many islands. They seem well-governed by broadly "african" standards and are well-connected to Europe by air, history and currency.

Crime is pretty low and relatively draconian steps are taken to keep it that way. Irish and Spanish-connected developments have not gone well and, I understand "sheikh-dom" investments have also slowed off but there are many reasons why the islands may become the quality destination tha was hoped 2-3 years ago.

As an investment proposition, it is not really any different than ever it was, just that the range of risks - and the liquidity issues - are more-keenly observed now

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Mr Pederson

Jun 08, 2011 at 15:24

@Eden W

Do you sell Cape Verde properties?

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Jun 08, 2011 at 15:28

Re Evan Owen

"'SIPP Approved' investments"

I have seen many of these - as its my job to vet them to see whether we would allow them to be invested in our SIPP products.

I have had concerns for some time now about the standard of some of the UCIS I am presented with. We have knocked quite a few back. Many are poorly drafted and offer staggering returns.

I suspect that there will be many more cases like this that come to light.

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l'ifa passeport en provenance de France

Jun 08, 2011 at 15:39

Pensionman, im looking at setting up a fund based somewhere in the middle east to sell land on the moon to grow trees for carbon offsetting , can i use your sipp?

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Gareth Fatchett

Jun 08, 2011 at 16:19

If the loans were from the SIPP's and no consent was gained, it will be game over,

Whatever next ?

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l'ifa passeport en provenance de France

Jun 08, 2011 at 16:40

bloody hell! not even set up the UCIS and Gareth is on to me

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Evan Owen

Jun 08, 2011 at 16:41

Follow the money.

Anybody interested in some land which is within the development boundary in Snowdonia? 5 acres in total. Sea views, golf, sailing, mountain biking, climbing, surfing, boozing. It is 'SIPP Approved'....lots of poetential profit, take note that this is not landbanking FSA!

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Julian Stevens

Jun 08, 2011 at 16:53

That must be your small holding that Alan Lakey was telling me about yesterday ~ and there was me confusing it with something else.

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Eden W

Jun 08, 2011 at 20:29

Dear Mr Pederson,

I don't sell anything (except my advice services) and no - that advice has never included to buy in Cape Verde - much as my wife and I like the place (although I was close to buying myself once).

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Haydn Ellwood - Yellow Capital

Jun 09, 2011 at 09:25

Ring a ring a rosie, a pocket full of property - dish dash we all fall down - ring a ring a rosie

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Ruth Cordero

Sep 03, 2011 at 10:10

What of those 'lowly' investors who trusted Bentley-Leek with their savings? Will the FSA help us when we can't get any joy from companies such as this?

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Jan 04, 2012 at 14:31

Did the FSA ever come back with any report regarding this issue?

I can't see how they could have gone in and had a look at this mess and simply left it?

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