HEROES’ PENSION BETRAYAL
Scam scheme sanctioned in Whitehall could cost them up to £50,000 each
FORCES veterans have had their futures ruined by a Governmentsanctioned pension scam.
Although some are still suffering trauma from tours of Iraq, Afghanistan and Northern Ireland, they now face working into their eighties after losing nest eggs worth up to £50,000.
They said they had been ‘betrayed and abandoned’ by the Government which registered the rogue scheme but now refuses to help.
They are also furious at the Ministry of Defence for approving cash transfers despite earlier warnings from watchdogs.
Most victims agreed to switch their savings because the bogus schemes were enrolled with HMRC and the Pensions Regulator.
The Mail revealed yesterday that tens of thousands of pensioners have lost up to £10billion between them in a wider scandal.
The scams multiplied following the simplification of pension legislation by Tony Blair’s government in 2006. This meant that rogue financiers could register retirement schemes with the authorities in a few minutes – with virtually no checks.
Most of the Armed Forces victims were cold-called by the Pinnacle Pension Scheme soon after leaving uniform. It promised better returns than the Army scheme and Pinnacle hired former soldiers, paying them £250 for every comrade they signed up.
Ex-servicemen make up the majority of the 156 victims who moved £4.8million to Pinnacle.
They have been told there is ‘fat chance’ of getting their money back after the scheme was wound up last year.
To reassure potential customers, Pinnacle sent them documents with its HMRC and Pensions Regulator registration numbers prominently displayed in bold.
Chartwell Trustee Pension Solutions, the company behind Pinnacle, also employed former paratroopers to target fellow ex-servicemen.
One was employed full time, the other as a freelance ‘introducer’ who was paid £250 for everyone he persuaded to transfer an Army pension to Pinnacle.
Christoph Williams was contacted by the introducer in 2014, five years after leaving the Royal Engineers. He agreed to transfer his £8,400 pension.
‘He said he’d already moved his pension over and told me it looks promising and gives a nice return on the money we accumulated while serving,’ said Mr Williams.
‘Myself and most of the rest of the Army lads don’t know about pensions. They really sold it to us as being registered by HMRC and so it was trustworthy, or so they said. Being in the Army, you trust what you are told. I agreed to it and signed up.’
The transfer was made in May 2014 – more than a year after the MoD had been warned by regulators about the transfer of pensions to scam schemes.
After hearing nothing from Pinnacle for years, Mr Williams called his friend and was told it had ‘gone under’ and that the former paratrooper employed full time by its administrators had disappeared.
‘My friend was in a terrible way and felt very bad about what had happened. It’s an awful situation,’ he said. ‘I’ve spoken to many other victims of this, but many feel ashamed of what happened and are reluctant to speak out.
‘Hundreds lost their cash in the scam, some who served for 20 years. Meanwhile the people out there who have knowingly done this have so far avoided any real punishment.
‘For anyone losing their pensions is a terrible thing, but I do think for the Forces it is particularly hard. A lot of us are no good for other jobs by the time we leave because of injuries and mental health problems. It means veterans are even more dependent on their pensions than most.’
A judge wound up Chartwell Trustee Pension Solutions in June 2018, after ruling that it had operated with a lack of commercial probity, a lack of transparency, and without any presence at its registered office address.
Insolvency Service investigators were unable to obtain any clear view of how the company operated.
A freedom of information request has revealed that between 2013 and 2015, at the height of the scams, about 3,600 former service personnel transferred their money out of the MoD pension scheme.
The ministry said the majority switched to other public sector pensions but that still means that scores or even hundreds more veterans may have been fleeced.
An MoD spokesman said: ‘We were obliged to agree to transfer
pensions when an individual requested this and we always advised that those wishing to transfer should seek independent financial advice before doing so. We only transferred to pension funds which were approved by HMRC.’
Nicole Newbury, the director of compliance at HMRC, said that in 2013 and 2014 tougher registration tests were introduced to ‘detect, disrupt and deter promoters of these pension scams’.
She added: ‘Since these new laws were introduced, HMRC has noted an 88 per cent drop in scheme applications, and last year alone rejected 11 per cent of applications for failing to meet the high standards required – safeguarding taxpayers and their savings.’
The veterans’ money vanished after being invested in a storage unit company. Pinnacle was among a number of schemes – and individual investors – to put cash into Store First and three related companies that were eventually wound up in April.
Between 2011 and 2016, the firms sold 22,600 ‘storage pods’ for a combined total of £209million. In one promotional video, it was claimed that a £15,000 investment could return £13,000 in six years – a profit of 85 per cent.
But in April the High Court in Manchester ordered that the four companies – Store First Ltd, Store First St Helens, Store First Blackburn and SFM Services – should be closed in the public interest. The last listed director of Chartwell Trustee Pension Solutions declined to comment.