HMRC To Axe Hundreds Of Pension Liberation Firms

HMRC To Axe Hundreds Of Pension Liberation FirmsHundreds of dubious pension firms servicing discredited pension liberations schemes face closure by HM Revenue and Customs.

An HMRC task force has been combatting gangs of alleged fraudsters as part of the secret Project Bloom.

Duped retirement savers have helped compile a list of almost 500 pension providers involved in pension liberation.

The Financial Conduct Authority is also investigating the part self-invested pension plan (SiPP) providers may playing pension liberation.

The HMRC inquiry may also stretch overseas to involve Qualifying Recognised Overseas Pension Schemes (QROPS) that may assist in pension liberation.

Pension liberation outlawed

Pension liberation or unlocking was outlawed by the High Court as a scam aimed at defrauding retirement savers by encouraging them to switch their funds away from legitimate financial firms on a promise they could access their money before the age of 55.

No one under 55 years old can take money from a pension except in special circumstances.

HMRC, the Financial Conduct Authority and The Pensions Regulator are due to move on the firms within a few days.

Tom McPhail, of investment firm Hargreaves Lansdown, said: “HMRC putting a lot of resources into Project Bloom and the scourge of pension liberation. Deregistration of so many firms confirms that.

“But the registration process for opening a pension fund needs examining as so many dubious providers seem to be at work.

“The issue seems to be small trusts running pensions that are not vetted as vigorously as contract-based pensions or SiPPs.”

Spam drops 80% after arrests

Meanwhile, firms that monitor spam emails and texts claim pension liberation traffic has dropped by 80% since HMRC and police raided offices in London and arrested several people allegedly involved in arranging fraudulent pension transfers.

Police arrested three men and seized computers and paperwork in May, 2013.

The raid followed complaints from retirement savers that they had lost their pension funds as the result of arrangement made after they responded to a text saying: “You can now unlock your frozen pension prior to 55. Release cash from your pension today. Just reply yes and we will post you a free information pack today”

Andrew Conway, of anti-spam consultancy Cloudmark, said: “The spam fell considerably from the day the police raided the pension boiler-room office in London and arrested the three guys.

“We could see that compared with the 30 days before the police raid, spam pension liberation traffic dropped by 78% in the 30 days after and has remained somewhere near that level.”

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