What Can We Learn from the Collapse of Universal Wealth Management?

The collapse of Universal Wealth Management last week has caused a stir among the general public but for those working within the legal profession it was more a question of when, not if, the firm would fold. Elizabeth Young, partner at Roythornes Solicitors, shares the lessons to be learnt from the scandal.

Universal Wealth Management has been operating for some time now and targets specific geographical areas inviting locals to seminars which focus on asset protection.

In principal there is nothing wrong with this tactic, however, their seminars sell asset protection schemes such as how to protect your house if you end up in a care home which are in many cases inappropriate, and result in families losing more than they protect.

The very nature of the ‘product’ tends to attract trusting, vulnerable, older people and it’s this specific aspect I take issue with, especially since most people never end up in care. In fact, approximately a mere 4% of the population aged above 65 years live in care homes, with this number rising to 16% for those aged over 85.

We are often approached by clients who are concerned and want to protect their assets, particularly their homes, in case they need to move in to residential care. Roythornes offer a balanced approach to such questions and consider all the pros and cons. In many cases it is simply not needed, but where it is a serious possibility, there are far gentler ways of protecting assets without going to the huge expense or process proposed by Universal Wealth.

There are therefore a few key pieces of advice I would give to not only the victims of the collapse but also to anyone who finds themselves in a situation which seems too good to be true.

1. Speak to someone you trust

If you are concerned about these issues then go to a source you can trust. Ask friends and family to recommend you to an adviser who is well known, and widely regarded in your area. Two heads are better than one and they may be able to recommend solutions to the problem or a place to get impartial advice. I would recommend starting with free resources such as Solicitors for the Elderly, Age UK or the Law Society but also seek legal advice if you’re particularly concerned.

2. Do your research

Before trusting anyone with your assets, do some research and make sure they have a proven track record of delivering a quality service. By doing your due diligence and researching whether they are regulated, what their reputation is like, who runs the company and what qualifications they have, you can quite quickly form an opinion.

If more people had researched Universal Wealth Management before handing over their assets they would have realised that the managing director had been suspended from STEP – the global professional association for family inheritance and succession planning practitioners – last year. A telling sign regarding the practices of the business.

3. Check in with your elderly friends and family

Most people are now aware of scams that come in the post or over the phone but it’s always worth watching out for the older members of your family or elderly friends to check they aren’t being lured into a deal, that is quite frankly, too good to be true.

Schemes, such as the seminars promoted by Universal Wealth Management using headlines such as ‘45,000 families every year are forced to sell their homes to pay for their care’, target the more vulnerable members of our society so keeping a watching eye over them is no bad thing.

My take home message is that if it sounds too good to be true, it probably is and if it isn’t, you’ve at least done your checks and won’t fall foul to bad or immoral practices.

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