Time to shine a light on murky corner of the UK
WE are all impoverished if financial misconduct goes unpunished, because the lack of deterrence creates an environment where crooks can prosper.
The anguish caused by unscrupulous professional advisers was etched across the faces of the participants in the Enough is Enough March for Justice, which was held in central London.
The marchers were victims of a horrifying range of fraud, misselling and scams, often involving regulated advisors. They had decided to speak with one voice and demand a public inquiry into financial misconduct in the UK, alongside fair tax treatment for victims.
Margaret Snowdon, chair of the Pension Scams Industry Group, believes a statutory inquiry is needed to get to the heart of the problem.
She told me: “We also require HMRC to look at their policy on tax collection, work in line with their charter and to use powers to go after fraudsters rather than solely pursue the victims.”
A new report – Pensions and investment fraud scams – outlines the scale of one long-running scandal. Too many pension and investment fraud victims are encountering problems at all levels after reporting crimes committed against them.
Campaigners claim that HMRC is levying tax charges against investment and pension fraud victims rather than acting against the perpetrators of the crimes, which is leading to “severe welfare and financial issues” for victims.
The report, which combines the expertise of the Pension Scams Industry Group (PSIG) and the Investment Fraud All Party Parliamentary Group (IF APPG), calls for action to end victim blaming and an improved definition of fraud and scams.
Key recommendations from the IF APPG include a moratorium and settlement of historic cases and the introduction of new policies and legislation to regulate HMRC’s treatment and taxation of victims. It also calls for the introduction of a new victim welfare advocacy service and financial redress for victims.
The Investment Fraud APPG believes that young people and sports professionals are among the most commonly targeted groups in the UK, alongside people age over 55, who have been duped into pension liberation scams. With sports professionals, crooks seek their investment in products and properties which may be fraudulent.
HMRC has said it sympathises with people who may have lost money by entering such arrangements and it handles these situations on a case-by-case basis. "We recognise that dealing with large tax liabilities can lead to pressure on individuals and we are committed to identifying and supporting anyone who needs extra help,” a spokesman said.
“We have a legal duty to collect tax whenever it’s due but our message to anyone who is worried about paying what they owe is: please contact us as soon as possible to talk about your options.”
The sheer volume of cases linked to financial misconduct means the issue cannot be kicked into the long grass by regulators and Government. A public inquiry would shine a light into one of the murkiest corners of modern Britain.
Greg Wright is the deputy business editor of The Yorkshire Post.