Concept Group Limited

Innovators in Pension Trusts, Trustees and Corporate Administrators

Three qualifying recognised overseas pension schemes have fallen under suspicion of acting as fronts for pensions liberation.

A communication sent out to members of the Society of Pension Consultants has warned of two schemes registered in New Zealand and one in Latvia.

Pensions liberation is the act of setting up a front company which receives tax registration to receive pension pots from other schemes.

The company then advertises to scheme members who wish to receive their pension as one lump sum before retirement and without paying tax.

The activity is not only illegal, but poses great costs and risk for members, who often pass half of their pension pot to the liberation company in exchange for early access.

Vernon Holgate, director at Capital Cranfield Trustees, said there were legal dangers for trustees too.

“This could implicate a trustee in an act which is designed to defraud the Exchequer, i.e. its illegal and could carry reputational risks or even some form of sanction in extreme cases.
”Above all it is not sensible to allow criminals to gain access to your savings. They are morally compromised people by definition.

Extract from Pensions Week
By David Rowley
Published: 28 June, 2010
 
http://www.pensionsweek.com/news/fullstory.php/aid/3624/Three_QROPs_under_pensions_liberation_cloud.html