He said: “The Resort Group have built everything they said they were going to build and these are good, working resorts."
He said The Resort Group was different to failed overseas property investment company Harlequin, which UK pension investors also backed heavily and where they incurred large losses, because unlike Harlequin it has delivered on its promise to build the properties.
The problem, as he sees it, is that people who invested through their pensions are not getting what they thought they would be getting.
He said: “The TRG issues are more to do with the fact it’s a financial product. When the market is down and people want to suddenly get rid of something, that is hard to sell.”
Glyn Taylor, a solicitor at Anthony Philip James & Co, put the blame on the way the products were marketed, making investors believe they would be getting higher returns on their pensions than they were currently getting.
But he said Sipp providers should never have accepted the investments into their books.
He said: “The Sipp trustee has a specific duty not to accept an underlying asset without taking reasonable steps to ensure they are able to undertake realistic annual valuations.
“If the investment is high risk and illiquid then it shouldn’t be accepted as it is inappropriate for a Sipp investment by a retail customer.”
London & Colonial and Rowanmoor said client suitability was the responsibility of the advisers.
But London & Colonial said it had “undertaken the appropriate due diligence” at the time its clients chose to invest in TRG.
Rowanmoor said it had controlled its intake but was not responsible for delivering a return to investors on the investments they hold, which was separate from the fees it charges.
It said: “TRG was a high-risk, liquidity controlled investment and investor suitability should have accounted for this. This is why we have only a small number of pension holders with these assets.”
The Financial Conduct Authority (FCA) last year wrote to investors in The Resort Group to ask for information on their investments.
The Financial Services Compensation Scheme, meanwhile, has paid out on some TRG claims but not on others.
One of the investors FTAdviser spoke to, Mr Magowan, was awarded £50,000 from the FSCS after bringing a claim against C.I.B. through a claims management company.
But Clare Knight, who was also advised by C.I.B., was told she could not bring a claim while another related claim against her Sipp provider London & Colonial was pending with the Pension Ombudsman.
Al Rush, principal at Echelon Wealthcare, called on Sipp providers to take responsibility for the investments they allow on their books.