Four scammers who conned pension savers out of £13.7 million have been banned from the industry and banned from being company directors or trustees. The Pensions Regulator has launched a criminal investigation as these people need to be jailed for swindling so many out of their life savings.

David Austin was the leader of the group and he and his family took most of the proceeds.

The money was spent on lavish living – and only £3.2M of the cash taken was actually invested in anything and that was a risky venture.

David Austin is a former bankrupt with no experience running an investment business, but conned people into investing with him.

The scam starts with cold calling and websites set up to lure pension investors. The scammers created a series of bogus investments including one about growing truffle trees and one about a Caribbean holiday site.

The victims were told their pensions would be reinvested and they would be paid an upfront cash lump sum for making the transfer. They were also lied to that their funds would be put into assets, bonds and HMRC-compliant investments to meet the target return of 5% growth a year.

False documents were used to trick staff at the schemes where the victims had their pensions – into believing that the pension holders worked for companies linked to the scam schemes. This meant the staff were persuaded to allow £13.7 million of funds to be transferred to the scam schemes.

David Austin installed fellow criminals Alan Barratt, Susan Dalton and Julian Hanson as the trustees for the scam schemes and they were then paid to act on his instructions, allowing the scheme monies to be used at Austin’s will. Barratt and Dalton also acted as salesmen for Austin’s Spain-based business, Select Pension Investments, persuading victims to transfer their pension pots into the schemes.

A small proportion of the funds – between 10% and 25% of the amounts transferred – were given back to the victims as their “rebate”, although many victims were assured that this payment was coming from the investment provider not out of their pension pots. More than £1 million was paid to “introducers” or “agents” who used cold-calling to encourage pension members to transfer over their funds.

More than £10.3 million was transferred to businesses owned or controlled by Austin,

A whistle-blower contacted The Pensions Regulator about the scam in November 2014 who then took control of the schemes to prevent further money being removed.

If you have any experiences with scammers, spammers or time-waster do let me know, by email.