Charlatans are driving a coach and horses through safeguards designed to protect savers, if my experience is anything to go by.
Certain sorts of risky investments should only be marketed to investors who are classed as sophisticated or high net worth, but rogue sales reps are trying to coax average savers into classifying themselves as wealthy.
I found this out for myself after being called by Apex Wealth Group, which has the motto: “Find an investment to suit you” - ironically, as things turned out.
The caller was flogging two savings bonds with returns of 8.1% and 8.4%, huge amounts compared to bank interest rates.
These were risky investments that were not suitable for most savers, yet the email I received from Apex Wealth stated that “investors such as yourself” could buy them.
The rep, who used the name Francis Cooper, phoned several times, continuing calls even when I said I didn’t have time to speak.
“I appreciate that opportunity and convenience rarely come hand in hand,” he said on one occasion.
“If you’re genuinely interested in something you can set 20 minutes of your day aside. Just tell me if it's not for you, if you want to leave your money in NS&I then do so, if you do want to get your money working you and take this seriously and give me a time frame when we can speak and I can explain why you can benefit from it and if it's something you want to take advantage off, fantastic, if you don't we can both go our separate ways as professionals.”
I explained that I could not give a time when it would be convenient to speak so Mr Cooper said he would not call back: “I think that's probably best because I don't want to be wasting my time. Bye.”
Yet he phoned again the following day, having said that he'd seen that I had re-opened his emails and asking: "What were you thoughts, pretty impressive?"
I explained that I had checked the websites of the two companies that were issuing the bonds and discovered that they were not suitable for me because they were meant only for sophisticated or high net worth individuals.
“Ok, allow me to explain, for you to take advantage of any of these bonds, you either have to be a sophisticated investor or high net worth individual,” Mr Cooper responded.
“A sophisticated investor essentially means you earn £100,000 a year or you've invested into a company in the last 12 months that's listed on the stock market or you're a director of a company.
“A high net worth individual essentially means you have assets totalling £250,000 including houses, pensions, liquidity, investments and everything else, do you fall into those categories?” Mr Cooper responded.
Me: “Including your house?”
Him: “Yes.”
Me: “Well, my house is worth that.”
Him: “And you’ve got a pension and things like that.”
Me: “Yes, I’ve got a pension.”
Him: “Yes, fine, all right then you would qualify.”
This is nonsense, your house is not included when calculating if you count as a high net worth individual, as explained by the FCA rules here, and he did not attempt to find out the value of any income or savings I might have.
The director of Apex Wealth Group is 32-year-old Pouya Patrik Aghabeh.
He has been in the news before. He used to work for estate agents Foxtons but was sacked in 2016 following a clash with Class War protesters near the London home of Boris Johnson.
Foxtons had closed its nearby branch early, fearing it might be target, and the London Standard reported that several Foxtons employees went to a nearby pub before encountering the protesters. The Mirror's account of the incident is here.
Mr Aghabeh told me: "With regards to the 'Foxtons event – I was wrongly arrested, the CPS dropped the case before court after having reviewed the relevant CCTV in the area."
I also asked him about the emails and phone calls from Francis Cooper, suggesting that his sales rep had encouraged me to wrongly classify myself as high net worth so his company could earn commission by selling me these risky bonds.
“We would stress that any client we introduce also has to go through further certification checks when placed with a potential product provider,” he said.
“But we have taken your points regarding the terminology used in our emails on board and will make the necessary adjustments to them.
"So for now we have no further comment and will deal with this staff member internally.”
He insisted that I had not been cold-called, saying “you registered your details for a call back on Friday 8th January 2021”.
I did, but not with his company.
I gave details to bondcomparethemarketuk.com after seeing it on a website promoted by Google Ads that was targeting savers.
This site, which carried a fake five-star feefo rating, claimed to offer safe bonds issued by major banks with rates of around 2-3% that were covered by the Financial Services Compensation Scheme.
The reality is that it passed on my details to Apex Wealth Group, an unregulated firm selling risky bonds from obscure lenders not covered by the financial compensation scheme.
Bondcomparethemarketuk.com has since been added to the Financial Conduct Authority’s warning list of unauthorised firms.
One of the products that was being sold to me was a bond with Access Commercial Investors 4 Plc. It said that it was ending its agreement with Apex after hearing my findings.
“We take great pride in our client journey, satisfaction and our onboarding process,” said a spokesman.
“We expect any company who is offering our product to do so with the same integrity and rules we do.
"We have only in the last few weeks entered into an agreement with Apex and this will be terminated with immediate affect."
The second of the products being pushed by Apex Wealth was a bond with Astute Capital Plc.
Astute told me: "We have recently been contacted by this company, we understand they are not regulated and as such should not be selling any investments including Astute bonds and especially not giving any advice.
"We were in the early stages of exploring potential cooperation and they had confirmed that if they were to promote then it would only be to investors that qualify as either High net worth or sophisticated investors."
I was told that Astute has written to Apex "to ensure they do not promote our company in any capacity whatsoever."
Astute Capital was yesterday added to the Financial Conduct Authority's alert list of unauthorised firms.
