People 'duped' out of pensions after investing in 'deceitful' care home investment scheme

Over a hundred people lost millions of pounds of their pension funds after being "duped" into investing in a care home ownership scheme.

At least 243 people invested over £11.6m into GCC Management, an unregulated company offering people the opportunity to invest in the purchase of care homes, with the promise of fixed rate returns of 10 per cent to 30 per cent.

One hundred and sixty-six of these investors transferred more than £7.8 million from their pensions.

GCC Management was run by Christopher Bateman and his business partner, Nicola Fairweather and after becoming insolvent, was found to owe investors £13.2m. Both have been banned for 25 years from forming or managing a company.

Robert Clarke, chief investigator for the Insolvency Service, said: “Our thorough investigations uncovered extensive abuse of investors who have lost millions of pounds through Bateman and Fairweather’s deceitful activities.

“Many investors were regular people who were not familiar with investments and were duped to transfer money from their hard-earned pensions."

“The judge commented in court that this was an appalling exploitation of relatively unsophisticated investors."

The Insolvency Service’s investigations were triggered when two connected companies, GCC Management Ltd and Amek Solutions Ltd, entered into insolvency procedures where Mr Bateman and Ms Fairweather were directors of both companies.

The Insolvency Service’s investigators found Mr Bateman caused Amek Solutions to breach the Financial Services and Markets Act 2000.

Misconduct included: advising people – many being unsophisticated investors – to transfer funds from their pensions; failing to advise investors to seek independent financial advice, and Amek did not have the authority to encourage investments.

'This should send a clear message'

Amek Solutions promoted GCC Management’s scheme to at least 133 people, who invested close to nearly six and a half million pounds from their pensions despite not being protected under the Financial Services Compensation Scheme.

Amek Solutions was rewarded by receiving more than £5.4 million in commission from GCC Management.

GCC Management produced misleading and unrealistic marketing materials based on a business plan which lacked commercial viability, there were no mitigation plans to help investors if returns couldn’t be made, and the company sent false information to investors about when their returns would be repaid.

From the funds they received through deception, GCC Management made unaccounted payments worth millions which did not benefit the company or its investors.

This included £1.4 million paid to connected companies Mr Bateman and Ms Fairweather were directors of and another £1.4 million to foreign exchange companies.

By September 2012, GCC Management only had one operating care home that had generated income, which was much lower than expected. However, the company continued to push their investment opportunities to dupe more investors.

"Thankfully Bateman and Fairweather have been removed from the corporate arena for a significant amount of time and this should send a clear message to other company directors that there are serious consequences if you dupe those seeking to invest pension funds to best effect," added Mr Clarke.