‘Returns were guaranteed – I lost £200,000’
High-risk property deals promoted via a celebrity’s investment club cost huge sums when they failed, writes Sam Meadows
Amillionaire property baron who made his name when he gave a house away to a single mother in a Channel 4 show promoted a number of investment schemes that failed, and in which investors who were paid-up members of his “investment club” lost hundreds of thousands of pounds, Telegraph Money can reveal.
Marco Robinson starred on Get a House For Free last summer in which he spent time with three families in need of housing, before opting to gift a £120,000 flat to a teenage single mother.
Mr Robinson’s website describes him as a “world authority on investing, entrepreneurship and financial freedom” and his social media profiles make numerous references to the Channel 4 show.
However, one investor has lost thousands after entering into investment schemes offering guaranteed returns recommended to them after becoming a member of his club.
Members would pay an annual fee to join the club and would be sent various investment schemes for their consideration. Neither the club nor Mr Robinson son processed the transactions on n behalf of investors, simply charging harging a further commission n for the introduction.
However, despite te charging a commission, the club ub member told Telegraph Money ney that no steps were taken n to ensure investments ts were suitable for specific individuals s and no questions were asked as to potential investors’ ’ wealth.
Typical investment advice suggests that only a small percentage of an individual’s wealth should be put into property investments, which h are often unsecured and unregulated. Some advisers argue such schemes should be completely avoided.
Emails sent to investors from the club state that it carried out the highest level of checks on potential schemes, reading: “We personally inspect and investigate not just the property, but also the surrounding area, the development plans, growth rates, demographics and a myriad of other info.”
The email continues: “You have my solemn word that all future investments, whether locally or internationally, will always go through my strict lab tests.”
However, at least two of the schemes recommended by the club failed, leaving investors with nothing.
One member told Telegraph Money she paid Mr Robinson close to £10,000 in sourcing fees for two property investments recommended by the club. She ploughed her pension savings of around £350,000 into a hotel investment invest in Kent and a property development in Liverpool a after attending a seminar held by Mr Robinson in a Singapore hot hotel in around 2012. Both investments invest ultimately failed and paid little, or nothing, in the way of o returns. The member described Mr Robinson Ro as an incredible incre raconteur. She joined the club, and an began paying the membership fee, after the seminar. Invoices I and bank statements seen by Telegraph Money re reveal he was paid aro around £10,000 in commissions co or “sourc “sourcing fees” for the two inv investments.
The promised guaranteed returns on the hotel investment were paid for little over a year before drying up. No rental income from the development in Liverpool ever materialised.
Mr Robinson told Telegraph Money that any claims of guaranteed returns were on the part of the developers. He was merely recommending potential investments, and providing an introduction to the developers, rather than underwriting them.
The prospectus for the Kent hotel given to investors bore the branding of Marco Robinson Lifetime Investment Club, and said it “ticks all the good investment boxes”. It also stated that the scheme had a “guaranteed 10pc return on purchase price for 10 years”.
In relation to the hotel scheme, Mr Robinson said that, once the management company had stopped paying the returns, he had paid one year’s worth of returns out of his own pocket and later offered compensation to those who had lost out.
Emails seen by Telegraph Money suggest the compensation offered was in the form of a property investment scheme of a similar nature to the original.
The investor said she had no interest in entering into another scheme and rejected the offer.
She added: “It isn’t just the sourcing fee I lost, it’s the money I invested and the returns I was promised. I was supposed to be making £40,000 a year from these investments.” Although the investor has received some compensation, she has still sustained losses of more than £200,000.
“It’s been night after night of lying in bed worrying about this,” she said. “It takes over your whole life. I believe that stress makes you ill and two years after this started I developed multiple sclerosis and I am sure it’s the stress of knowing I’ve lost our pension.”
Mr Robinson said: “You are taking an isolated case out of thousands of happy members over a 20-year period of which this person was offered ample compensation even
though I have no relationship to the developer.”
He declined to answer further questions about the investment club. Channel 4 said it could not comment on Mr Robinson’s personal or business matters.
Alistair Cunningham, an adviser at Wingate Financial Planning, said unsecured property investments were suitable for almost no one.
“If you see something offering high levels of guaranteed returns you basically need to run a mile,” he said.
“I have one client who bought this type of development and even though it’s run by a reputable company he has been trying to get out of it for 14 years. There’s no resale market. If all of his pension wealth was in there, he would be in trouble.
“The problem with property schemes is they give people a false sense of security, as they can always drive up to the building and see it. The problem is they are not diverse, often illiquid and sometimes overvalued.”
‘Property schemes give people a false sense of security, but it’s hard to get out’
A seminar at a Singapore hotel attracted investors; Marco Robinson, below