Pensions provider Friends Life has identified a significant increase in the amount of attempted pensions liberation activity, with the company declining over 500 requests since August 2012.
Pensions liberation has made the headlines of late as the next big scandal to hit the financial services industry. Friends Life adopts a hard stance on the activity, taking a proactive approach to targeting the firms encouraging the practice.
The firm has declined over 500 requests to transfer pensions into, what it has identified as, high-risk schemes since August last year. The total transfer value of these requests has been in excess of £12 million.
When the company becomes suspicious that a member is requesting a potential pensions liberation transfer, Friends Life follows a due diligence process on the request. The process is in line with the Pension Regulator's recommended checklist and ensures the transfer does not go ahead, when warning signs are highlighted, to protect the long term interests of our customers. The company has identified a significant number of high risk schemes to date.
In addition, Friends Life is issuing the Pensions Regulator customer leaflet to all customers where the transfer request looks suspicious, as well as launching guidance information on the company's website, to help educate customers and enable them to make informed decisions. Any suspicious requests are reported to HM Revenue & Customs and Action Fraud who are the UK's national fraud reporting centre.
Martin Palmer, Head of Corporate Benefits Marketing at Friends Life, said: "The fact that the companies instigating pensions liberation transfers and the schemes they are attempting to transfer the funds into are not registered is not only worrying for the industry but could be devastating for the future financial wellbeing of customers. The industry needs to take action, sooner rather than later to avoid this becoming the next big scandal and to help safeguard the retirement provision of thousands of people across the UK."
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