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Aegon warns 80% of overseas pension transfers are scams

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Eight out of 10 requests for overseas pension transfers are scams designed to raid savers’ pots, Aegon warns.

The provider’s analysis of 50 requests to transfer pensions to overseas schemes in the first quarter of this year found 80 per cent were actually fraudulent.

Aegon says fraudsters have been targeting small pots of around £30,000 after customers are lured in with the promise of pension reviews.

If a pension is transferred to an overseas scheme that does not meet HMRC’s requirements, the pot can be subject to an unauthorised payment charge normally around 55 per cent.

In the worst cases, entire pension pots can be lost for good.

Last week, international advisers branded HMRC’s list of recognised overseas pension schemes “irrelevant” after it slashed the number of approved schemes.

Aegon regulatory strategy manager Kate Smith says: “Fraudsters are not only plausible but are also highly persuasive and it can be all too easy to fall for their polished performance, unless you are on your guard.

“We’re seeing more and more sophisticated ways of unscrupulous people getting their hands on people’s retirement savings and it’s not just the over 55s who are being preyed on, younger customers are being targeted too.

However, Standard Life head of pensions strategy Jamie Jenkins says the provider does not have a big issue with overseas transfers.

He says: “We certainly share the concern for the dangers of pension scams and it has become a major focus within our transfer checks. That said, we have seen far less of an issue with Qrops and we believe only a minority of those we are asked about are potential scams. The vast majority of our Qrops transfers are to long established and well known overseas schemes.”

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Comments

There are 4 comments at the moment, we would love to hear your opinion too.

  1. Bethell Codrington 13th July 2015 at 3:42 pm

    Aegon brand 80% of Overseas Pensions as ‘Scams’. It is a bit rich for a firm that has transferred large sums to UK Registered Schemes such as Ark, Capita Oak, Portman, Quantum, Westminster etc and dozens of other Liberations Scams in the past, landing members with 55% tax liabilities. but we don’t hear so much about that, and they accept no responsibility for those transfers.
    How many UK pension providers transferred assets to Australia, Ireland & Canada ROPS/QROPS post April 5th 2015? If they had bothered to do basic due diligence on the receiving schemes and read SI673 there would not be the debacle that is currently going on.
    Liberation and Scams go on all over the world, including UK. People need to remain diligent, and do the basic checks.

  2. Well done to Aegon for calling this out. It is always way too easy to leave it to the regulators.

  3. Christopher Lean 13th July 2015 at 4:48 pm

    How many requests for UK to UK transfers are scams, since a lot of pension liberation is home grown?

  4. Bethell Codrington 13th July 2015 at 5:44 pm

    @JP. Regrettably the Regulators as you refer to them, do not ‘regulate’. New UK pensions are at best “registered” with HMRC and tPR (not obligatory). A common misconception and something the scammers are keen to mislead the public on.
    It is all ‘self-assessment’. Fill in a form on-line and get a reference number. Until it blows up and a scam is uncovered, only then do the authorities appear.
    We should go back to the pre2006 era when at least schemes got some checking before reference numbers were handed out.

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