The regulator and tax man are both getting tougher with the pension fraudsters who offer a service designed to ‘liberate’ a pension fund before age 55.
Of course this isn’t really pension liberation, it’s a scam which results in massive charges, punitive tax charges and ending up in dodgy investments.
Financial Conduct Authority (FCA) chief executive Martin Wheatley has branded them as ‘a scam that operates beyond legality and beyond morality,’ before promising a crackdown on those authorised firms lending the scammers a ‘veneer of respectability’.
We have also heard today that HM Revenue & Customs is preparing to deregister around 500 ‘dubious’ pension providers as part of their action against pension liberation scammers.
It’s about time that the FCA and HMRC took a hard line against these pension liberation schemes.
Victims of these scams often end up with little of what they expected to receive, after tax penalties and product charges have been deducted.
Where authorised and regulated financial advisers are involved in such schemes, introducing their clients to the providers or making investment recommendations for ‘liberated’ pension schemes, they also should face severe sanctions from the regulator.
If you want to access your pension fund before age 55, the legal and moral options for doing so are extremely limited.
What you certainly would not want to do is give your details to any of the dodgy companies which continue to populate the Google search results for terms including ‘free my pension’ or ‘early pension release’.
