ActionFraud - National Fraud & Cyber Crime Reporting Centre - Call 0300 123 2040

Alert: Cold calls regarding unregulated forestry investments

Fraudsters are cold calling victims and persuading them to transfer their pension from legitimate schemes into unregulated forestry investments schemes that promise of high returns.

Last year 26% of victims who reported investment scams to Action Fraud were persuaded to invest in these fraudulent schemes. 

How does the scam work?

Victims approaching retirement age are cold called and encouraged to engage in a pension review. As part of the selling technique, the caller will advertise forestry investments as part of a new pension plan. 

They then persuade the victim to transfer their pension monies from a legitimate pension scheme to an alternative pension company and invest 25% of a pension fund which is tax free into long term forestry projects in places such as Costa Rica, with promised high returns.

Once the victim has invested in forestry, teak, bamboo, forestry shares, tree plantations or Christmas trees, promotional material will be received by the victim via post or email, promoting the benefits of the scheme. The forestry firm will continue to cold call, encouraging the victim to:

  • Setup up regular investment payments in order to receive a greater return.
  • Request an upfront fee (approximately 10% of the investment) for a security bond.
  • Request an advance fee for insurance to cover a temporary payment abroad to locations such as Hong Kong and Gibraltar.

Victims have found that they do not have easy access to their forestry investment, or have experienced a reduced return rate. The practicalities of the forestry investment are not explained thoroughly, for example the length of time taken for trees to mature is dependent upon many variables which would affect the return rate for investors.

The Financial Conduct Authority's (FCA) new campaign is encouraging anyone who is considering an investment to check its ‘Scamsmart’ website and seek independent financial advice from a regulated professional before going ahead.

How to protect yourself

  • Be suspicious of all unsolicited calls. Cold-calling for investment business is illegal, so reputable brokers will not do it.
  • Do not give out personal or financial details and never agree to anything or send money upfront without making your own enquires into the company first.
  • Make some enquiries by checking whether the company is regulated on the FCA register or calling the FCA on 0300 500 5000.
  • Ensure that you request that the risks and growth rates are explained and that you fully understand them before transferring your pension.

To report a fraud and receive a police crime reference number, call Action Fraud on 0300 123 2040 or use our online fraud reporting tool.

Sign up for free to Action Fraud Alert to receive direct, verified, accurate information about scams and fraud in your area by email, recorded voice and text message.

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