Lancs Cops issue warning about pension scam July 29th, 2013 admin Latest News Shares Comments Police issue warning about pension scam POLICE in Lancashire are warning people not to fall foul of a pension scam which could see them losing over half of their savings. The scam – pension liberation fraud – takes the form of cold calling or unsolicited texts from a contact centre who offer people the chance to cash in on their pensions before the normal private pension early retirement age of 55. False or misleading claims of ‘better rates of interest’ or a cash incentive to transfer funds are made but the taxation implications of removing your funds from your existing pension provider are not explained. In rare cases – such as terminal illness – it is possible to access funds before age 55 from your current pension scheme. But for the majority of people, promises of early cash will be bogus and are likely to result in serious tax consequences. Tax charges of over half the value of your pension could be made for taking an ‘unauthorised payment’ from your pension fund in this way. In addition, fees deducted from your pension by the pension release companies for arranging the transfer are unlikely to ever be recovered. Such fees tend to be very high and could be 20 per cent or more of a person’s pension savings. Mark Aldridge from Lancashire Constabulary’s Economic Crime Unit said: “We want as many people as possible to be aware of this scam. “When these type of companies contact you they may not fully explain to you about the fees charged or the fact that by removing your funds before 55 there is a liability for tax. “The person contacting you will often not be registered to give independent financial advice and your remaining funds may be transferred overseas outside the jurisdiction of UK regulatory bodies. “If considering making alterations to your pension arrangements you should seek independent financial advice. “Please look after your pension. Remember, at retirement age your pension pot could be worth £50,000 but if you cash it in too soon the Government may take 50 per cent of it back and the scammers take 25 per cent of it in ‘administration fees’. This could result in you receiving £12,000 instead of £50,000.” Anyone who thinks they are the victim of Pension Liberation Fraud you should report it to Action Fraud by telephone on 0300 123 2040 or online at www www.actionfraud.police.uk For impartial information and guidance visit www.pensionsadvisoryservice.org.uk Submit News Contact us with your community, business or sport news. Phone 07930717137 Email [email protected] Twitter www.twitter.com/onthespot_news Related Comments comments!