My Plundered Pension
Tony Hetherington
Mail on Sunday
05 Dec 2004
Also by Tony Hetherington: Why Crooks are Laughing features Tony Hetherington's contact details
See also: Alerts - T.H. on Land Banking Scams
Mrs C.N. writes: I was conned into
believing I had transferred my pension from British Gas to a firm called the
Brand New Carpet Company Ltd. I was told there was a loophole that allowed this,
subject to tax.
Tax of £14,322 was deducted, but now the Inland Revenue says the company was a
sham and has given me a bill for a further £25,000.
Yes, you have been conned. But who has made the biggest profit? Yes, the Inland
Revenue and the Treasury.
The Brand New Carpet Company was based in Liverpool. Its salesmen targeted
people who had been made redundant and were short of cash.
They claimed you could transfer your pension rights to their company scheme with
immediate benefits.
They told your old employer that you now worked for the carpet company, and when
your old employer handed over your £65,298 pension fund, they helped themselves
to part of it and sent you the balance.
Then the taxman said the whole thing was illegal, you were not allowed to take
cash from your pension scheme - and deducted a further £25,000.
The Occupational Pensions Regulatory Authority found that the Brand New Carpet
Company was a fraud and shut it down. Opra said: 'While we have found several
bank accounts, we have yet to find a single carpet.'
Investigators froze bank accounts holding a few hundred thousand pounds, but
'many millions' have gone. It seems hundreds of redundant workers from firms
such as the Cammell Laird shipyard and Golden Wonder crisps were victims, and
police are investigating.
Strictly speaking, the Revenue is entitled to its percentage when anyone
withdraws cash from a pension ahead of retirement. After all, there is tax
relief on contributions.
However, you are not some City fat cat who deliberately drains his pension fund
and disappears. You are a victim of fraud. Yet the Revenue is treating you, and
people like you, as an easy target.
Pensions expert Mark Grant of lawyer CMS Cameron McKenna said: 'This is a
double-whammy. They lose to the fraudsters, then the Revenue wants its take,
too.'
Grant would like the Revenue to allow you to put back what is left of your
pension money into a genuine scheme without the £25,000 tax deduction.
But when I asked whether this had even been considered, an official passed the
buck, saying: 'The Inland Revenue has to operate within the legislation laid
down by Parliament.'
However, the Government minister responsible, Stephen Timms, abdicated
responsibility. His staff told me: 'This is a matter for the Inland Revenue.'
When you reach retirement and claim state benefits because you have no work
pension, I suggest you explain how you were ripped off by the Brand New Carpet
Company and then fleeced by the Revenue. And how the Government that wants us
all to provide for ourselves in old age couldn't care less.
(Tony Hetherington).
05 December 2004