FCA Steps Up Action on High-Risk
Unregulated Collective Investment Schemes

A UCIS (Unregulated Collective Investment Scheme) pools investors’ money to fund large-scale projects such as hotels, apartments or care homes. Investors are often told they’ll earn rental income or fixed returns, but because these schemes are unregulated, they carry high risks and are usually unsuitable for everyday investors.

The FCA explains this as follows:

“Exemptions in the law mean certain high-risk investments can be marketed directly to those considered wealthy or if they’re an experienced investor, known as a ‘sophisticated investor’, under strict criteria.

In the UK, potential investors can self-certify that they are sophisticated.

If you’re asked to confirm that you are a sophisticated investor, think carefully about whether you genuinely have experience of similar high-risk investments, and whether it’s in your best interest. Otherwise, you could be exposed to investment opportunities that aren’t appropriate and certain regulatory protections will not apply.”

In other words, not all investments are suitable for everyone. It’s best to study all the information and, if necessary, seek advice from an Independent Financial Adviser (IFA).

The FCA considers UCIS high-risk; in September 2025, it warned that people selling unregulated investments often use slick websites, marketing campaigns, or even social media ‘finfluencers’ to attract investors. Many schemes are funded by mini-bonds (or ‘loan notes’) – effectively IOUs where the company promises to repay investors with interest, but only if the underlying project succeeds.

Investors may be attracted to a UCIS by the ‘guaranteed’ or ‘secure’ returns; however, what we know from years of helping victims of financial mis-selling is that if an investment sounds too good to be true, it usually is.

Other tactics used to mislead investors include:

• Misleading comparisons between UCIS and regulated products like ISAs or pension funds to imply similar protection.
• Confusing or complex investment structures leaving investors unsure where their money is going or how it will generate returns.
• Downplaying fees and commissions paid to introducers and advisers.
• Pressure-selling tactics push investors to act quickly to ‘avoid missing out’.
• Claiming FCA approval or links to reputable firms when none exist.
• Leaving investors unaware that funds can be locked in for years or that properties can be challenging to sell.
• Marketing that omits to say that consumer protections such as the FSCS or Financial Ombudsman don’t cover the scheme.

Concept Capital Group (CCG) made headline news earlier this year when the FCA announced it would issue Court proceedings against the firm, six individuals and another company, Gateridge Consulting Ltd. The Court case has begun, but is still in the early stages.

CCG encouraged investments in static caravans leased to social housing tenants assigned by local authorities. Investors were told that the scheme had government support and that they would earn a guaranteed fixed return. However, the FCA claims this information was either false or misleading, and the scheme was run as an Unauthorised Collective Investment Scheme (UCIS).

The FCA has updated its advice to investors worried about what would happen to their investments throughout the duration of the Court hearing:

“To be clear, CCG’s undertakings to the Court allow it to make payments of rent, license fees or regular returns on investments, and do not allow it to make redemption or buy-back payments. Also, while CCG’s undertakings to the Court do not allow it to promote or sell the Scheme, existing tenancies or licences in respect of static homes owned by CCG or by investors are unaffected by CCG’s undertakings.”

Sarah Spruce, Legal Director at TLW Solicitors, supports the FCA’s efforts to protect investors, saying:

“Many people do not realise that some investment firms are regulated, while others are not, or that some schemes are suitable for regular investors and others are only for sophisticated investors. Clever marketing tactics and financial influencers (‘finfluencers’) can catch people out, leaving them vulnerable to financial loss.

UCIS schemes are particularly concerning, as they are high-risk and quite often unregulated, and it’s reassuring to see that the FCA is stepping up legal action against firms and individuals who break the rules.

If you or a loved one have invested in a UCIS, lost money, and believe you were mis-sold, please contact my team for a no obligation and confidential discussion to explore the options available to you, including whether you may be eligible to make a no-win, no-fee compensation claim.”

Common red flags to be aware of include:

• No FCA regulation – no ‘lifeboat’ Financial Services Compensation Scheme (FSCS) protection, or access to the Financial Ombudsman (FOS), the independent body responsible for resolving disputes between financial services providers and their customers).
• High risk of total loss – investments often involve risky, illiquid assets such as property developments or storage units.
• Limited transparency – there’s little information about how funds are utilised or how the scheme performs.
• Unsuitable for most investors – generally only appropriate for high-net-worth or ‘sophisticated’ investors.
• High commissions – advisers or introducers may earn substantial fees, leading to conflicts of interest.
• Fraud risk – unregulated schemes are more susceptible to scams or mismanagement.
• Difficult to exit – investments can be locked in for years with minimal or no resale options.

Following a rise in unregulated and high-risk investment schemes, the Financial Conduct Authority (FCA) has reminded investors to take extra care before parting with their money. Their key advice includes:

• Check whether the FCA regulates both the firm and the investment, and make sure you understand the level of risk.
• If a scheme isn’t regulated, you’ll have limited protection or recourse if things go wrong.
• High returns usually mean high risk – if it sounds too good to be true, it probably is.
• Compare any promised returns with standard savings or bond rates to judge if they seem realistic.
• Only confirm that you’re a ‘sophisticated investor’ if you genuinely have experience with complex, high-risk investments.
• Do your research – read company reports and seek professional advice if you’re unsure.
• Spread your investments to reduce the impact of one scheme failing.
• Keep high-risk investments to a small share of your overall portfolio – around 10% or less.
• Be cautious of unsolicited contact or pressure to invest quickly.

If you’ve invested in CCG or a similar unauthorised collective investment scheme, TLW Solicitors may be able to help recover your losses. Our experienced lawyers can evaluate whether:

• The scheme was misrepresented to you.
• A solicitor, financial adviser, accountant, or introducer breached their duty of care.
• You have valid grounds for a professional negligence claim.
• Your bank should have intervened under the Authorised Push Payment (APP) fraud rules.

We have specialised experience handling cases involving collective investment schemes, particularly where investors’ funds were used for property projects like apartment and hotel developments, helping clients recover their lost investments.