FRAUD VICTIMS TASK FORCE

Pension Life is joining forces with another group action in order to set up the Fraud Victims Task Force. The objective of this initiative is to reinforce the campaign to protect fraud victims.  As outlined in Greg Mulholland’s motion before parliament was dissolved,  victims want to see prosecutions and sanctions against those who commit fraud.  Further, they want to see a workable tax exemption regime for victims who are pursued for tax by HMRC in addition to pension and investment losses they have suffered.

AIMS AND OBJECTIVES OF THE FRAUD VICTIMS TASK FORCE

1. To unite victims of financial fraud, abuse and mis-selling – and give them an effective voice
2. To campaign for positive change to defend victims’ rights and interests
3. To call for a change in the law to introduce an exemption for tax liabilities arising as a direct result of fraud
4. To investigate, analyse and summarise patterns of financial fraud which result in tax demands
5. To report on the unjust result of victims rather than criminals being pursued and penalised by HMRC
6. To calculate the inequitable correlation between tax collected and the long-term cost to the State
7. To build strong reporting relationships between stakeholders in the industry to expose scams as early possible
8. To bring to justice negligent parties who facilitate financial crime and ensure they compensate their victims
9. To expose the failures in regulation and law enforcement which encourage fraud
10. To recommend improvements in cooperation of government, regulators, ombudsmen and law enforcement agencies internationally

FRAUD VICTIMS TASK FORCE STRUCTURE

The proposed Task Force membership – subject to acceptance by each individual member – is intended to cover all the disciplines required to produce an in-depth analysis and subsequent powerful report which identifies and quantifies the problem and recommends workable solutions for implementation by the government, HMRC, regulators, ombudsmen and police authorities.

The members of the Task Force will include the below functions and invitations for each position are being sent out currently:

Joint Chairs – representing the two Action Groups

Parliamentary Advisers – to be finalised after the election

Criminal Specialist – criminal and sports barrister

Financial Services Specialist (and Treasurer) – Chartered Financial Planner and pension transfer specialist 

Pensions Specialist

Tax Specialist

Legislative Specialist

Political Specialists

Technical Tax Specialist (to draft proposed legislation)

Mental Health Specialist (to advise on the effects of being a victim of fraud and HMRC simultaneously)

Ambassadors (high-profile celebrities from the world of sports and music)

Victims (members of scams such as Ark, Capita Oak, Salmon Enterprises, London Quantum and Trafalgar etc.

PROPOSED FRAUD VICTIMS TASK FORCE REPORT STRUCTURE – DRAFT

• Outline the main types of pension and investment fraud
• Describe how each type results in financial loss and tax liabilities
• Provide examples of each type identified
• Identify the “players” behind each type and example
• Explain what regulatory omissions failed to prevent or sanction the individuals and firms
• Quantify known losses and tax liabilities
• Outline the impact on the victims and their families
• Define how the government can lead a strong collection of measures to combat pension and investment fraud
• Calculate the financial damage done to the public and the State by the present position and…
• Calculate the potential financial advantages to the public and the State achievable through reform

SPOTLIGHT ON THE HIGH COURT ARK/DALRIADA BEDDOE PROCEEDINGS ON 19.6.2017

To highlight the problem, attention is drawn to the impending Beddoe proceedings in respect of the Ark matter.  Ark was placed in the hands of Dalriada Trustees on 31.5.2011 and consisted of 487 members; £30 million worth of transfers and £11 million worth of loans.  The reciprocal loan structure was judged to be a fraud on the power of investment by the High Court in November 2011 and Justice Bean determined that the loans were not validly made.

In the intervening six years, approaching 15% of the fund value has been spent on trustees’ and solicitors’ fees; Dalriada are now threatening to bankrupt the victims in order to recover the loans; HMRC are threatening to bankrupt the victims in order to collect 55% tax on the loans at both the receiving end and the making end – as well as 40% tax on the scheme itself.  The tax will, according to HMRC, remain payable even if the loans are repaid.

Dalriada are asking the High Court for permission and directions to use the victims’ funds to pay for legal action to recover the loans.  Few victims have sufficient assets or income to either pay the tax or repay the loans.  Some have already died, either through stress-related diseases or suicide; many are very ill – mentally or physically; many will lose their homes.  Even those who did not receive loans are being taxed because, according to HMRC, they transferred to Ark with the intention of receiving a loan.

Representative Beneficiary Kim Goldsmith (a community nurse) and her legal team, QC Keith Bryant and solicitor Trowers and Hamlins will be vigorously contesting Dalriada’s application.