Pension fraud scheme: FCA charges three, implicates firms. Losses of £8M. High-risk trading scheme under scrutiny.
Pension fraud scheme: FCA charges three, implicates firms. Losses of £8M. High-risk trading scheme under scrutiny.
In a Pension Fraud Scheme, FCA levied charges against three individuals, Kristofer McGuire, Keith Williamson, and Karla Walker, alleging their involvement in a fraudulent trading scheme targeting pension savings. The accused are facing multiple charges, including fraud by false representation and fraudulent trading, related to persuading victims to invest in high-risk contracts for difference (CFDs).
The FCA asserts that victims were coerced into investing their pension funds into CFDs, purportedly for trading purposes, which ultimately resulted in significant losses, nearly wiping out their pension savings. The accused allegedly misrepresented their clients as professional investors to a trading platform, exploiting their trust for personal gain.
The allegations span from January 2015 to February 2023, during which the accused reportedly made misleading representations about their clients’ qualifications as professional investors. Furthermore, between January 2015 and June 2016, Williamson and McGuire allegedly employed detrimental trading strategies, causing investors to suffer losses.
McGuire faces additional charges for allegedly making false statements to individual investors between April 2016 and February 2023 to persuade them to invest through his firm, K&K Consult LTD. The defendants, facing charges under the Fraud Act 2006 and the Companies Act 2006, will appear before Westminster Magistrates Court on June 7.
The FCA highlights the risks linked to CFDs, noting that 80% of investors experience losses due to their leveraged structure. To protect consumers, the FCA has introduced limitations on selling and promoting CFDs to retail customers.
In its ongoing efforts to combat investment and pension fraud, the FCA continues its ScamSmart awareness campaign, which saw action against unauthorized debt solution providers last year, including shutting down websites and social media accounts. In 2023, the FCA took action against over 10,000 misleading financial advertisements and promotions.
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