Meanwhile the industry was rocked by the announcement of a £2.5m suspected tax relief fraud this week, involving a number of IFAs and Sipp operators who were arrested and then bailed.
Eleven people, including IFAs and Sipp operators, were arrested in relation to the multi-million pound suspected tax relief fraud which involved bogus pensions schemes.
Fourteen premises were searched including homes in Merseyside, Greater Manchester, Staffordshire, Worcestershire and Cumbria.
Documents, paperwork, mobile phones and computers were seized and the individuals were questioned.
The arrests followed an HMRC investigation into the suspected fraudulent use of tax relief repayments linked to pension schemes marketed by a number of UK financial firms.
The case involves the suspected fraudulent reclamation of income tax relief on pension contributions contrary to the pension tax rules under Part 4 of the Finance Act 2004.
HMRC says the “full scale” of the suspected fraud is not yet known. Assistant director criminal investigations North West Mike O’Grady says: “This is an unusual investigation into what we believe to be an organised attack on tax relief available on self-invested pension schemes.
“We do not expect to know the full scale of this suspected fraud until we have assessed all the evidence collected.”
The FSA and The Pensions Regulator were closely involved in the probe.
FSA small firms division head of investments Linda Woodall says: “We are monitoring the financial firms involved and will take action if it is appropriate to do so within our remit as a financial services regulator.”
Money Marketing revealed last week that the FSA is undertaking a thematic review of small Sipp providers to check whether they are adhering to its rules. We also revealed this week that the FSA is to widen its open market option review to include Sipps.
So it seems Sipps are again in the spotlight and this suspected fraud, while unusual and not representative of the vast majority of the industry, is unlikely to result in the FSA taking the pressure off.
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