UK - OPRA is allowing trustees extra time for transfer payments in a bid to combat trust busting or pension liberation' scams.
The move follows threats from the Inland Revenue to remove the tax-approved status of pension schemes which fail to adhere to money transfer rules.
Under present OPRA regulations schemes must complete transfers within their set time period to avoid being fined.
OPRA chief executive Tony Hobman said: “Pension liberation puts people’s hard earned savings at risk. We want pension trustees to know that they will not be punished for being careful.”
The regulator notes that under current Inland Revenue rules – reiterated in the department’s pensions update number 132 – it is the responsibility of the scheme making the transfer to make sure the proposed recipient is a bona-fide pensions scheme.
OPRA adds that if trustees have suspicions regarding a transfer request they can simply refuse to pay the transfer and tell the requesting scheme to write to OPRA if it is not satisfied.
OPRA says that as a rule of thumb, any scheme in a position to process transfer payments quickly could be suspect, as most schemes will expect delays linked to the calculation of guaranteed minimum pensions.
This advice follows the emergence of a plethora of schemes notably the Brand New Carpet Company.
Such pension liberation companies are known to charge commissions as high as 20-30% of an individual’s total fund.
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