Pension liberation is believed to have cost the UK more than £500m to date, the National Crime Agency said, as it continued to alert internet registries to pension liberation websites.
More than 10 pension liberation websites have been taken offline after the NCA alerted internet registries.
The NCA said all the websites misrepresented key facts on accessing cash from pension funds, thereby enabling pension liberation fraud “which is believed to have cost the UK more than half a billion pounds to date”.
John Lawson, head of policy at Aviva, previously told FTAdviser that pension liberation is at least a £600m problem.
Through giving misleading information, the sites were designed to convince visitors to access part of their pension fund immediately through transferring it into a new scheme.
Barring exceptional circumstances, anyone doing this prior to retirement must pay tax charges which can amount to more than 50 per cent of their entire pension fund, the NCA warned.
It added any money remaining can be decimated by ‘fees’ taken by the fraudsters, or their channelling it into worthless or non-existent investments.
The NCA’s alerts detailed the misleading language used on the websites concerned, which flouted the respective domain registrars’ terms and conditions and thereby gave grounds for their removal by the hosts.
The NCA’s action forms part of ongoing, wide-ranging action to combat this type of fraud.
The NCA warned individuals attempting to access certain sites, or domains with similar names, will now be automatically redirected to a page on the Action Fraud website providing information on identifying and reporting pension liberation fraud.
The domain owners were directed to a webpage explaining the action taken against them.
Project Bloom, the multi-agency taskforce set up to address pension liberation activity, has to date issued awareness-raising products to the banking, pensions and public sectors, made arrests and disrupted pension liberation fraud operations, the NCA said.
Earlier this week, HM Revenue & Customs responded to calls from the industry to tighten up its pension scheme registration system to limit potential for liberation fraud by ditching its “process now, check later” approach and implementing a system of risk assessment prior to registering a scheme.
Stephanie Jeavons, of the NCA, said: “Pension funds are relied on by millions to sustain us in retirement, and the consequences of being tricked into losing them through tax penalties and worthless investments can be devastating.
“Some victims of pension liberation fraud only find out when they retire that much, or all, of their pension is gone.
“Denying fraudsters the channels of communication they need to part people from their money is a key element of our approach to tackling this type of crime.
“The NCA and its partners are also working to help members of the public spot this type of scam, and to dismantle pension liberation fraud enterprises.”
