BBC’s You and Yours programme covers unregulated investments

You and Yours, BBC Radio 4’s consumer affairs programme, has just released its latest episode which partly deals with three investors who were encouraged to invest their money in unregulated investments.

The programme makes interesting and, at times, painful listening for anyone with an interest in unregulated investments.

[2:40] Winifred Robinson (BBC presenter): The three people you’re about to hear were encouraged to invest their pension savings into risky unregulated funds. Two of them say they were cold called at home.

In 2015 Stephen Sefton needed to transfer his pension from his company pension scheme to a new one in order to access income drawdown.

[4:28] John Douglas (BBC presenter): He, like many people, was looking to take advantage of new pension rules. He wanted to be able to access his pension savings and leave money to his children. To do it, he had to transfer from his company pension scheme to a new one. That was why he went looking for a financial adviser, and he found David Vilka’s company [Square Mile International Financial] online.

W: Did he have much money in his pension?

J: Yeah, around £415,000. And Stephen agreed it should go into an overseas pension scheme before being invested in two funds. The first, called Blackmore Global, is where most of his money went. The rest went to another fund in Malta.

No reason is given in the BBC programme for why Mr Sefton was recommended an overseas pension. Overseas pensions are generally only suitable for expats with very specific tax circumstances.

Mr Sefton first encountered problems a year later when he couldn’t find out what his pension – his share of the two funds – was worth. He subsequently found out that Square Mile International Financial was not authorised to provide financial advice or transfer UK pensions. They were on the FCA register, but only to provide insurance mediation.

[5:48] J: The FCA has confirmed to us that Square Mile International Financial does not have the necessary permission to deal with pension transfers. David Vilka though maintains his firm is authorised and it hasn’t done anything wrong.

The programme then moves on to the nature of the underlying investments.

[6:10] J: We’ve seen a document which shows the fund is Malta is a “professional investor fund”, in other words it was never supposed to be for the general public, so wasn’t appropriate for someone like Stephen.

Then there’s that other fund, Blackmore Global, where most of his money went. We know the managers of a pension scheme on the Isle of Man were worried about that; they sent a letter to their clients who’d already invested in Blackmore Global saying they’d concluded it posed an unacceptably high level of risk.

W: In what way?

J: Well, the letter said that they’d become increasingly concerned at the lack of financial accounting information that was available for Blackmore Global, so they’d removed it from their list of approved investments.

The BBC programme goes on to describe a man named Paul (not his real name) who was one of those who received that letter from the Isle of Man pension firm. He’d invested all his pension savings, around £100,000, in Blackmore Global, after being contacted by a firm called Aspinal Chase.

The Isle of Man SIPP provider offered to try and get his money out of the Blackmore Global fund, and said that if Paul didn’t want to do that, he needed to get confirmation from a regulated adviser confirming it was still suitable.

Paul contacted Aspinal Chase, who

[8:25] J: …sent him a reassuring letter suggesting the Blackmore fund was performing well, the letter said the advice still stood from his financial advisers that the fund fit his circumstances perfectly. The thing is Winifred, Aspinal Chase listed Paul’s financial advisers as none other than Square Mile International Financial in Prague, the same company that dealt with Stephen Sefton’s pension. And the letter to Paul from Aspinal Chase went on to say that Square Mile certainly has the correct regulation, which of course we now know is far from certain. But those reassurances from Aspinal Chase were enough for Paul to leave his money where it is in Blackmore Global.

What he didn’t know is that there’s a connection between Aspinal Chase and Blackmore Global. Both companies were run by the same man.

W: So the people who are behind the company that Paul says cold-called him… they also own the fund where his money ends up?

J: That’s right. Philip Nunn and Patrick McCressh are both directors of the Blackmore Global Fund and directors of Aspinal Chase. Aspinal Chase was linked to David Vilka’s financial advisers in Prague, because it was described as the “UK administration team” on paperwork sent to advisers. So both the cold calling operation and the financial advisers’ admin team were based at the same address in Manchester. Phillip Nunn and Patrick McCreesh’s businesses were also involved in processing applications to transfer money out of pension schemes – money that would ultimately end up in the Blackmore Global Fund, which they control.

The BBC report then reviews the charges applied by the Blackmore fund disclosed in its fee document, with the aid of Rory Percival, a leading industry consultant and former regulator at the Financial Conduct Authority, where he specialised in the regulation of investment advice.

[10:45] Rory: Gosh. The fees are… in comparison with most investments, very very high. You’d have to be getting very very high levels of returns even to make any money out of that.

J: Is this sort of investment suitable for someone wanting an income from a pension?

R: No, because it’s up to the directors when you get your money. If you’re saving for your retirement, you want to be in control of when you get your money, to live on in retirement. So no, absolutely not.

J: Now even though it was mentioned in some of their paperwork, some investors didn’t realise their money would be locked into the Blackmore Global Fund for ten years. Even after that time, Rory says, getting the money out might not be easy, as it depends on the fund being able to sell its underlying assets.

Paul says he’s been trying for a year to get his money out of the fund, and has got nothing to date. He had hoped to retire at 60, and has found his money is locked into Blackmore well beyond his 60th birthday.

[12:25] P: I’ve got three grandchildren – we’d like to take them all to Disneyworld in America. I want to spend the money I’ve earned over the years – a bit of that money would pay off the last bit of me mortgage – so that is a big chunk of my future.

J: How has all this affected you and your family?

P: We do have the occasional arguments, and I feel as though I’ve let the family down. I’ve tried to put it to the back of my mind but when you start looking at what’s going to happen in the future… it’s what is going to happen in the future… I don’t know, I just don’t know.

The third investor (who does not speak on the programme) is Jacqueline, who invested £50,000 in Blackmore Global after being cold called by Aspinal Chase, and also has documents showing Square Mile International Financial as her adviser. Blackmore Global has refused to release her money “to protect the integrity of the investment for its other stakeholders”.

Stephen Sefton did manage to get his investment back, but only after taking a £30,000 loss on the unnamed fund in Malta, and after repeatedly emailing and complaining over a period of 18 months.

David Vilka and Square Mile International Financial say his company’s permissions and activities have been inspected and verified in full by numerous regulators, and that there is no financial relationship between his business and those run by Philip Nunn and Patrick McCreesh. He says he helped Stephen Sefton get his money out of the Blackmore fund.

Philip Nunn and Patrick McSheesh say there is no connection between themselves and David Vilka / Square Mile International Financial. They say Aspinal Chase never engaged in cold calling, and did not give pensions advice; any advice was given by separate regulated financial advisers. They told the BBC “they had nothing to hide, and wished to act with as much transparency as possible”, but refused to grant an interview or send audited accounts for the Blackmore Global Fund, or a list of its underlying holdings.


Stephen Sefton believed his adviser was authorised to offer financial advice because he found them on the FCA register. He did not know that he was supposed to check the drop-down list under “Permissions” to make sure they had the necessary authorisation to give advice, and to advise on pension transfers.

This is a well-known issue. It is simple for anyone who knows they have to check “Permissions” to check it, but for everyone else it is the classic unknown unknown. How are they supposed to know they should check the list of Permissions when they don’t know they should know?

Even government bodies such as the Pensions Advisory Service tell users to “check the FCA register” without making it clear they need to check the Permissions drop-down.

The FCA is under some pressure to make its register more “user-friendly”, but in the meantime investors should bear in mind the following:

  • Professional advice should always be taken from advisers regulated in the UK and authorised to provide advice. Do not just check the register, but check they have permission to advise. Do not respond to cold calls.
  • UK Investors should not invest in an offshore arrangement, whether a pension, a fund or any other wrapper or security, unless they have a need that would not be met by an onshore arrangement. Any regulator or compliance consultant will confirm this principle.
  • Any investor who is advised to invest all their investments in one or two funds should be very confident that it is highly diversified and liquid. Examples of funds which may be suitable as a single holding include Vanguard Lifestrategy or Legal & General Multi-Index, which are spread across thousands of mainstream blue-chip shares on recognised stock exchanges. This is trivial to verify. This is not the case with any investment which does not disclose audited accounts or a breakdown of its underlying assets.
  • There are many legitimate reasons to invest in unregulated and/or offshore arrangements. Any UK investor who should be investing in such arrangements will know exactly what they are, because they will either be a professional investor, or they will have a suitability letter from an FCA-regulated adviser detailing why the investment is suitable and why a regulated/onshore investment would not meet their needs. If you are advised to invest in any arrangement which is not regulated in the UK without good reason, proceed with extreme caution.

The quote above from Paul at 12:25 shows why these steps are necessary with heartbreaking clarity.


Mr Sefton, who was interviewed in the above report, got in touch with us to request a correction (this article originally read “No reason is given in the BBC programme for why Mr Sefton needed an overseas pension”).

I did not need a QROP; the BBC’s turn of phrase was unfortunate for giving that impression. I was actually “mis-sold” it by David Vilka on false statements of tax advantages that I later discovered were untrue, and also that it is “approved by the HMRC” which I later discovered is not true because HMRC do not approve schemes.

2 thoughts on “BBC’s You and Yours programme covers unregulated investments

  1. A nice accurate account of the BBC Programme.

    The operation is deliberately obfuscated with actors in numerous jurisdictions UK, Isle of Man, Czech Republic, Malta and Cayman Islands. The funds are deliberately opaque.

    Angie Brooks, owner of published an email from one of the actors that proves conclusively there is a “business connection” between Aspinal Chase and Square mile, contrary to what Nunn & McCreesh say above.

    That email is here:

    However, the FCA have all the evidence and hopefully, if they do their job, this operation will be shut down and the actors appropriately sanctioned. A big IF however!

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