The Pensions Regulator has rolled out an e-learning tool to help pension trustees and administrators recognise the warning signs of ‘pension liberation’ fraud as part of an ongoing assault against such schemes by regulators.
The online ‘bite-sized’ learning module for trustees and administrators takes the user step-by-step through actions they may take, including identifying the first warning signs, contacting the member and the ‘suspect’ scheme, and deciding whether to process the transfer.
By completing the module the regular claimed users will be able to identify what pension liberation is and when it can be fraudulent and the next steps they should consider taking if liberation fraud is suspected.
Earlier this month TPR, the Department for Works and Pensions, Serious Fraud Office and Financial Services Authority co-published an information pack to be used by providers when requests are made for a scheme transfer.
It comes following a warning issued in 2012 by TPR alongside FSA and HM Revenue and Customs that almost £200m was transferred into so-called pension reciprocation schemes in 2011.
HMRC previously told FTAdviser that investors should stay “well away” from pension offers that claim to be able to provide loans or release tax-free cash from people’s pension pots before they reach age 55.
HMRC warned that the total tax charge on an unauthorised payment can amount to 70 per cent.
Victoria Holmes, the regulator’s case team leader for DC, governance and administration, said: “We want to enable the industry to easily spot the warning signs of pension liberation fraud.
“This user-friendly module is designed to help trustees and administrators deliver timely warnings to members and prevent members pursuing transfers into dubious arrangements, where they risk losing a significant portion of their pension as well as facing high tax charges and fees.
“We’re very pleased with the industry’s positive response to the cross-government information campaign, with frequent downloads of the action pack, transfer insert and member information leaflet.”
