The Government has set up a specialist fraud unit to monitor Qrops due to concerns about fraudulent activity and irresponsible transfers.
An internal ABI pensions note, seen by Money Marketing, reveals that HMRC has established a dedicated team to monitor the activities of Qrops amid concerns over “general abuse” of schemes acting outside the legislation.
The specialist Qrops unit is a sub-division of the Anti-Fraud Unit. An HMRC spokesman says the unit, contained within its pension scheme services department, works closely with officials at the Pensions Regulator and the FSA.
Worldwide Financial Planning IFA Nick McBreen says: “I am not at all surprised HMRC is looking very closely to make sure schemes are used appropriately. I think it is inevitable that the Government will eventually tighten the rules around Qrops.”
Montfort International managing director Geraint Davies says: “A lot of people offering Qrops are bending the rules. There are some innocent advisers in the UK working with Qrops providers in other countries who are not aware what they are up to.”
In April 2008, HMRC deregistered all Singapore-based Qrops, leaving members vulnerable to a 55 per cent unauthorised payment charge on their transferred pot.
Last September, HMRC revoked the status of Hong Kong-based Beazley Consulting Pension Scheme as it failed to meet its criteria for Qrops status.