Treasury to limit statutory right to transfer pensions
The Treasury has confirmed plans to limit the statutory right to transfer pensions in a bid to clamp down on fraud.
In a response to its consultation paper issued in December 2016, it said it would introduce tougher measures around transfers and the setting up of small self-administered schemes (SSAS).
Under new measures, individuals will only have the right to transfer their pension if it is moved into a personal pension scheme authorised by the Financial Conduct Authority (FCA), moved into an authorised Master Trust scheme, or when a genuine employment link to the receiving pension scheme can be evidenced.
The Treasury will also consider how best to extend the criteria under which there is a statutory right to transfer to qualifying recognised overseas pension schemes (QROPS).
It further noted that SSASs “were vulnerable to scams” and suggested increasing regulation in this market.
Meanwhile, the Treasury expressed its intent to work on the “final and complex details” of the ban on cold calling in relation to pensions.
It said a blanket ban will be introduced on all pension cold calling – including texts and emails. Details of the ban will be worked on “during the course of the year” and implemented “when parliamentary time allows”.
Recent figures show that 97 per cent of all pension fraud cases brought to Citizens Advice stemmed from cold calling.