Qualifying Recognised Overseas Pension Schemes (QROPS) have been a source of significant financial distress for many UK expatriates and international investors. Over the past decade, allegations of fraudulent and negligent investment practices linked to QROPS have sparked high-profile class action lawsuits, particularly in the Isle of Man (IoM). These legal battles, involving claims worth hundreds of millions of pounds, centre on unit-linked life assurance bonds sold by unlicensed, commission-driven financial advisers operating in regions such as Thailand, Indonesia, Cyprus, the UAE, and the UK. Despite ongoing litigation, many investors are still awaiting justice, with cases mired in delays and complex legal proceedings. This article explores the current state of QROPS-related class actions, the challenges faced by affected investors, and the broader call for regulatory reform to protect pensioners and investors.
Closer to home in the UK, QROPS were abused by Unregulated Introducers who convinced normal UK Consumers to transfer existing FCA regulated private pensions, old workplace pensions and even final salary (Defined Benefit) pensions into overseas pensions in order to circumvent FCA regulation and invest people into high-risk unregulated investments like The Resort Group, Store First and Dolphin Capital which subsequently failed, leading innocent customers losing some or all of their pension savings
Many of those investors have been unable to get compensation due to the lack of a UK Financial Adviser or Pension Provider, however in some cases, particularly when transfers took place after January 2013, we have successfully gained full redress for people who have been affected.
If you or somebody you know has lost money in an overseas pension scheme, then you can book a free consultation to find out if you may be eligible to claim or read more about some of the ongoing battles below.
A Decade of Legal Battles
The 2020 Class Action
In 2020, over 700 UK investors initiated a £100 million class action against Friends Provident International (FPI) and Utmost International (formerly Quilter International) in the Isle of Man.
Represented by London-based Signature Litigation and IoM-based Callin Wild, the claimants alleged significant losses tied to the collapse of several investment funds, including the LM Managed Performance Fund, Axiom Legal Financing Fund, and New Earth, all linked to the 2016 collapse of LM Investment Management.
The case was heard at Douglas High Court from 8 April to 23 May 2024, with expectations of a judgment within weeks or months. However, as of May 2025, the court has yet to deliver a verdict, leaving investors in limbo. The judge is reportedly still deliberating, with no clear timeline for a resolution.
The 2023 £325 Million Claim
In a larger case launched in 2023, approximately 1,600 investors filed a £325 million lawsuit against Utmost International and FPI in the Isle of Man. Legal proceedings began in June 2023, with the defence expected to present its case in the summer of that year. A significant hearing on 23 April 2024 addressed whether non-test claimants, advised by the same brokers, could be bound to the outcomes of a test trial involving 20 selected claimants. The court ruled that the pleadings and evidence were “insufficiently uniform” across claimants, complicating efforts to streamline the case. The identification of test claimants and common factual issues remains unresolved, with a case management hearing scheduled for 18 September 2025.
RL360 and Additional Claims
FPI’s parent company, International Financial Group Limited (IFGL), also owns RL360 Insurance Company, which faced a separate group claim in March 2025. This claim relates to investments in the same collapsed funds involved in the Utmost and FPI cases, further highlighting systemic issues within IoM-based financial products.
The Role of Commission-Based Advisers
Unlike the UK, where commission-based financial advice has been largely phased out, the Isle of Man continues to permit commission-driven models. Advisers in the IoM can get income through product sale commissions as well as asset-based fees, or hourly rates. However, many of the QROPS-related issues stem from unregulated, non-IoM-based independent financial advisers (IFAs) operating in regions like the Middle East. These advisers, often working on commission, have been accused of promoting high-risk, opaque investment products to expatriates, leading to substantial losses.
Sharon Sutton, a former chartered financial planner and past president of the Personal Finance Society, clarified that the cases primarily involve IFAs outside of the Isle of Man selling to expatriate clients. The IoM Financial Services Authority (IoMFSA) regulates local advisers, requiring transparency in fees and commissions, but its oversight does not extend to overseas advisers. The IoMFSA has stated it is monitoring the class actions but cannot comment on active cases, as it is not a party to the proceedings.
These regulatory loopholes are the same ones which were exploited in the UK for many years.
Insurers’ Response
Utmost International has denied the validity of the claims, asserting that it is “robustly defending” the lawsuits. A spokesperson emphasised the company’s commitment to positive customer outcomes and its serious approach to client obligations. Friends Provident International and IFGL were also approached for comment but have not publicly responded to the allegations at the time of writing.
The Investor Experience
For nearly a decade, investors entangled in QROPS-related class actions have faced prolonged uncertainty. Many allege they were misled into high-risk investments with little transparency, resulting in significant financial losses and untold levels of emotional distress. The lack of accessible compensation mechanisms and the high cost of legal action only make things worse, leaving many feeling abandoned by the financial system.
Our Thoughts
As the Isle of Man courts continue to deliberate, it is astonishing that many people in the UK who have been affected by QROPS abuse and Investment mis-selling have yet to come forwards and make a claim.
Many we believe may not be aware of the severity of their losses until they reach retirement age. Others may have tried to claim, failed and now believe they have exhausted all options.
We would urge anyone in doubt, to reach out and see if we can help advise you on how to make a claim or even take on your claim on a no-win no-fee basis to reduce the stress and risk as much as possible, and ensure you get the outcome you deserve.
