Italian Fund to Add Infrastructure, Real Estate

Italian pension fund Solidarietà Veneto will add some new alternatives to its investment portfolio for the first time, the organization announced.

Two new asset classes, infrastructure and real estate, are set to enter the $1.5 billion plan’s asset mix for the first time as experience from private market investments have given Solidarietà officials the confidence to invest in other alts as well as continue to develop other areas.

The fund, which houses the retirement assets of pensioners in the Veneto region, also wants to further diversify its allocations, as traditional markets “remain in ‘hostage’ of the policies and announcements of the central banks” during the first half of 2019. According to the plan, Solidarietà’s current alts mix is too small to make an impact during a downturn. It did not disclose how much of the total portfolio was invested in alternatives.

“Precisely for this reason, in its last review of the strategic asset allocation, the Veneto Solidarity Board has planned a gradual increase in the share allocated to so-called ‘alternative’ investments,” it said, adding that environmental considerations have become a popular topic in recent meetings.

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Solidarietà also announced some tweaks to one of the four portfolios in which it splits its assets across (the dynamic fund, income, prudent, and guaranteed TFR). The dynamic fund will add more equities, going to 54% from 50%, and shed its bonds to 46%, from 50%.

“The intention is to compensate for the greater volatility deriving from the increase in the shareholding, with a deeper diversification and a more effective risk/return ratio, which will benefit the young people associated with this line,” the fund said.

All sub funds saw positive returns in the first half of 2019, with the dynamic fund returning 6.09% due to strong stocks. Income, prudent, and guaranteed TFR returned 3.93%, 3.59%, and 1.03%, respectively.

The fund started its foray into alternatives in 2013, with private credit and private equity investments. It did not say when either change would take effect.

Italy’s Pension Head: Early Retirement Age Idea Would Be a Costly Mess

Tags: Infrastructure, Italy, Pension, Real Estate, Solidarietà Veneto

UK regulators the Financial Conduct Authority (FCA) and The Pensions Regulator (TPR) are launching a campaign to warn the public about criminals targeting their retirement savings. The regulators said pension fraud victims lost an average of £82,000 in 2018.

The campaign will reach out to the public through TV, radio, and online advertising, and is being bolstered by new research from the regulators that suggest that 5 million people, or 42% of pension savers in the UK, could be at risk of falling for one of several common tactics used by pension scammers. They say the likelihood of being drawn into one or more scams increased to 60% among those who said they were actively looking for ways to enhance their retirement income.

“At a time when savers have more flexibility than ever over their pensions, it is inevitable that scurrilous criminals hellbent on stealing people’s retirement pots are circling,” TPR Chief Executive Charles Counsell wrote in a commentary on the regulator’s website. “These are not petty thieves, but sophisticated fraudsters using clever tactics to appear legitimate but who have just one aim—to rip people off and run.”

According to new survey research from the FCA and TPR, cold calls, exotic investments, and early access to cash among most persuasive tactics used by fraudsters. They also found that those who consider themselves financially savvy are just as likely to be persuaded by scammers as anyone else.

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The scammers are known to target pension savers by tempting them with offers of high returns in investments such as overseas property, renewable energy bonds, forestry, storage units, or biofuels. According to the research, 23% of 45- to 65-year-olds surveyed said they would likely pursue these exotic opportunities if offered. However, the regulators warn that exotic or unusual investments are high-risk and are typically unsuitable for pension savings.

The results also showed that attempts by scammers to help people access their pensions early proved to be a persuasive tactic as 17% of 45- to 54-year-old pension savers said they would be interested in an offer from a company that claimed it could help them get early access to their pension. However, the FCA and TPR warn that accessing your pension before 55 is likely to result in a large tax bill.

Even more troubling is that nearly a quarter (23%) of all those surveyed said they’d be willing to speak with a cold caller who wanted to discuss their pension plans, despite the fact that pension-cold calling was made illegal this year. The respondents said they would be likely to ask for website details, request further information, or find out what they’re offering, even if the call was unsolicited.

“Pensions are one of the largest and most important investments we’ll ever make, and robbing someone of their retirement is nothing short of despicable,” Guy Opperman, Minister for Pensions and Financial Inclusion, said in a statement. “We know we can beat these callous crooks, because getting the message out there does work.”

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Tags: Financial Conduct Authority, Fraud, Pension, The Pensions Regulator, UK