The Pensions Regulator has teamed up with financial services regulators and government agencies, including HMRC, the FSA and the Serious Fraud Office, to launch an information campaign designed to raise public awareness of the dangers of illegal early pension release or "liberation" schemes.
The warnings are detailed in a leaflet for members and action packs for trustees and pensions professionals. Branding the image of a scorpion and under the taglines 'predators stalk your pension' and 'don't let your pension become prey', the materials warn that fraudsters are targeting pension savers by sending spam text messages, making cold calls or publishing website promotions to encourage them to transfer their existing pension in return for a portion of the savings in cash before the age of 55. The campaign highlights the high fees and heavy tax penalties that can erode the savings of those who sign up to such schemes by more than half.
As part of the awareness campaign, scheme administrators are asked to include, as best practice, the pension liberation fraud insert in all transfer packs issued to members. If transfer packs are issued via third parties then administrators should consider sending the insert directly to members.
The Pensions Regulator is also encouraging trustees and pension providers to be cautious of transfer requests from members under the age of 55 (the age at which members are legally able to access their pensions savings, other than in cases of ill-health). Where they suspect funds are being transferred for the purposes of pension liberation, they may consider delaying or even ultimately refusing a transfer request and should report their suspicions to the Home Office's Action Fraud helpline.