Lancashire company in Â£9m fake truffle farm scam
A Lancashire company has been involved in a Â£9 scam that conned investors with a fake truffle farm.
Truffle Sales Ltd, based at Higher Walton on the outskirts of Preston, has been officially wound up by the High Court after a four-day trial.
The company, along with other firms based in London, Essex, Portishead and the Seychelles, used a network of unregulated financial advisory firms and targeted people that had access to their pension savings.
Investors were told their cash would go to plant oak and hazel saplings inoculated with truffle spores. They believed that the trees would grown on plantations in Spain and South Africa and would eventually produce the highly lucrative truffle crop.
Truffles, which are highly prized by chefs and fine food lovers, retail for an average of £6,000 per kilo.
However, investigators from the Insolvency Service found that no harvesting or cultivation has ever taken place to date at any of the plantations sold, despite the scheme first being sold to the public in 2012.
Investors paid anywhere between £750 and £995 per sapling with the promise they would see significant returns within five years after the truffles had been cultivated. But similar inoculated saplings were available to the public at the same time, costing only £7.95 to £9.95 per sapling.
Investors were also miss-sold the investment opportunities through unsubstantiated claims, such as having the option to trade out at any time of their contract and one investor was told they could expect a 200 per cent return over a ten year period.
In reality, investors had little or no remedy in relation to their investments and had no contractual relationship with the plantation companies responsible for maintaining the truffle trees for the contracted 15 years.
A total of £9 million worth of investments remains unexplained, according to the Insolvency Service.
Truffle Services Ltd received substantial commissions from the other firms involved - Viceroy Jones New Tech Ltd, Viceroy Jones Overseas PCC Limited, Westcountrytruffles Limited, and Credit Free Limited.
Cheryl Lambert, Chief Investigator for the Insolvency Service, said: "The companies and those behind them have showed no remorse in their calculated plan to scam investors of their pension pots. Although the Insolvency Service investigation was hampered by a lack of cooperation, the investigation pieced together the numerous layers in which the scam was wrapped.
"We take the matter of unregulated pension liberation investment schemes very seriously and will take action to stop any such schemes who have acted unscrupulously."