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Govt allays fears over pension cash launder

The Government has moved to calm industry fears of stakeholder plans being

used for money-laundering scams by allowing providers to refuse cash

payments.

Life offices had feared that Government proposals to allow people to make

cash contributions on someone else&#39s behalf could open up stakeholder

pensions to abuse.

But in the final Department of Social Security regulations, providers are

to be allowed discretion on whether to accept cash payments.

Providers were concerned they would have to accept mystery cash payments

from third parties with no means of assessing where the money originated.

Scottish Equitable pensions development manager Steve Cameron says: “The

real issue, while accepting the fact that some people do not have bank

accounts, is that by making providers accept cash payments, it creates a

real opportunity for money laundering.

“Such a move might be viewed as a clear endorsement of the black economy

making cash payments at branch level, an ideal way for drug dealers to plan

for their retirement.”

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