MPs are demanding a probe into the legal firms behind a multi-million-pound investment scandal.
Earlier this year, Money Mail revealed how building societies had referred thousands of elderly customers to unregulated companies.
Sales staff would then convince them to transfer their cash and properties into trusts to shield their wealth from care fees and inheritance tax.
MPs have now asked the Financial Conduct Authority to launch a ‘thematic review’ into trusts designed to shield wealth from care fees and inheritance tax
However, experts fear these investments could now be at risk after one firm collapsed in April.
Philips Trust Corporation managed some 2,345 trusts and is the legal owner of 447 properties worth an estimated £94 million.
But its director has admitted to mistreating clients’ money and making potentially inappropriate investment decisions without their knowledge.
MPs have now asked the Financial Conduct Authority (FCA) to launch a ‘thematic review’ into the sector.
Mark Bishop, of consumer lobby group Transparency Task Force, says: ‘It would seem that at least nine building societies earned undisclosed commissions by introducing elderly and vulnerable customers to firms that, at best, offered them poor advice and, at worst, may have misappropriated lifetime savings.’
However, the City watchdog told the all-party parliamentary group on personal banking and fairer financial services that it has no plans to launch a review.
This is despite the FCA conducting similar probes into money laundering and the debt management sector.
A spokesman for the regulator says: ‘We are aware of concerns regarding unregulated trust service providers and those making introductions to them, and are carrying out ongoing work in this area to assess and address any harms to consumers.
‘At this time we are not carrying out a thematic review.’
