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Sky News has uncovered data which shows that 67 land-bank companies have been forced into liquidation since 2009 – the year after the banking crisis – leaving investors £50 million worse off, many of whom may need to seek debt management advice.

The figures were obtained from the Insolvency Service, which says that complaints to the service from the public have increased by one-third (33%) since 2007.

It is estimated UK investors in land-bank schemes may have lost a total of £250 million through land-bank fraud, potentially pushing thousands into debt and in need of debt advice.

Sky News investigators approached the land-bank company Asset Land Investment, which sells plots of land to the public on the basis that once it is sold to a developer, they will make thousands of pounds on their original investment.

In many cases of land-bank fraud, the plots sold have little or no chance of receiving planning permission and being developed, as many are Green Belt. Investors are often left with plots of land they cannot sell and many may have invested all their savings in schemes, while the investment company retains the money and makes hundreds of thousands of pounds.

One single mum of five was persuaded by Asset Land Investment to put her £63,760-worth of savings into four plots, which her Asset broker told her would triple and net her thousands of pounds within 18 months once planning permission was obtained and the plots sold to a developer. She was also allegedly told by her Asset broker that she could withdraw from the investment at any time, but when she tried to get her money back, the company refused to return it.

Asset Land Investment alleged said that they could only return the money when plots were sold and only one plot at a time could be sold.

The investor says she was out of work and needed the money to pay the deposit to rent a property for her children as she could not get a mortgage.

Sky News reporters posed as investors and approached Asset Land Investment and were offered a plot in Harrogate for just under £18,000. The company said the plot was on the verge of receiving planning permission. Reporters were also told their investment would triple in 18 months. However, Harrogate Council denied there were plans to grant planning permission as the site was Green Belt.

Asset Land Investment markets sites in Harrogate, Newbury, Lutterworth, Steeple Morden and Stansted, which it purchases and divides into plots.

The Financial Services Authority (FSA) is warning consumers to be wary of anyone who cold calls to sell plots of land. The FSA said:

"They sound just like proper investment advisors, so don't think you'll be able to spot one when they call – their classic target victims are elderly because they're more trusting and more likely to have disposable cash.

"We've seen land sold in areas of special scientific interest and land sold on a slope so steep you would never be able to build on it – yet the potential investor is told that it will get planning permission.

“This gives rise to an element of fraud which the FSA and the police take an interest in."
Sky News reporters secretly filmed an interview with Stuart Cohen, Managing Director of Asset Land Investment, and later asked him for further comment, but he declined.

Anyone with debt problems as a result of losing money through financial fraud or a scam is advised to seek debt management advice from a reputable firm – and to be wary of cold calls or unsolicited emails offering debt advice or demanding money up front for debt management services.


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