Financial Services Compensation Scheme  

FSCS suspends investigation into advice firm

FSCS suspends investigation into advice firm

The Financial Services Compensation Scheme (FSCS) has suspended its investigation into advice firm Wealth Connection after it failed to receive information from Essex police to determine whether the firm owes a civil liability to its clients.

The lifeboat scheme posted an update on its investigation into Wealth Connection yesterday (March 9), which, it said, due to not receiving evidence requested from Essex police it was unable to continue.

Although it noted it may be able to restart the investigation if it receives this evidence in the future.

To date the FSCS received three claims against Wealth Connection from individuals who were advised to invest their pensions into various non-standard investments, some of which have become illiquid, which means they can’t currently be sold or traded.

One of the directors of Wealth Connection was charged with fraud by Essex Police on January 20, 2016. 

He was then sentenced on August 17, 2017 to six years in prison for fraud by abuse of position and two years for fraudulent trading, to run concurrently. 

It was found the director had invented a pension scheme, in which he loaned money to investors. The loans, with tax relief, were invested in a property company that he was a director of. They were then used to fund his own lifestyle.

Since summer 2019, the FSCS has been trying to discover if there are valid claims involving Wealth Connection as well as understand its connection to the loan scheme.

The lifeboat scheme has been looking into how investors became aware of the scheme as well as how investors’ money was invested. 

However, the FSCS needs more information to be able to determine if Wealth Connection owes a civil liability to its customers ie, that a UK court would hold the failed firm responsible for client losses.

The FSCS sought information from Essex Police regarding its investigation into the directors but to date this information has not been received and so the FSCS is unable to continue its own investigation.

What do you think about the issues raised by this story? Email us on to let us know.