Pension scammers are moving their operations abroad to dodge tighter UK regulations

Rogue financiers are shifting their operations abroad to fleece pensioners of millions of pounds.

An overseas base helps them dodge tighter UK regulations while also still taking advantage of official listings with the Inland Revenue.

Victims who have lost their life savings last night called on the Government to clamp down on the flagrant abuse of HMRC’S system for registering non-UK pension schemes.

They had thought it was safe to switch their nest eggs into the foreign funds because they were recognised by the British authorities.

But the money went into high-risk and often toxic investments that paid huge commissions to the scammers. The revelation follows a Mail investigation this week that has exposed how savers lost up to £10billion between them in UK schemes registered with HMRC and the Pensions Regulator.

This official registration led Army veterans, police officers, firemen, paramedics, care workers and teachers to believe the schemes were above board – until their money vanished.

The Government belatedly tightened regulations on British-based schemes – only for the swindlers to move abroad. This allows them to cold-call potential customers – a sales tactic outlawed in the UK this year because of its use by conmen. It also means rogue financial advisers can levy huge commissions, a practice also banned here.

Many people have lost their retirement savings (file image) as they were duped by scammers who are listed with HMRC and immediately ‘lends credibility’, according to Susan Monaghan, who was one of the victims

Pensions can be moved abroad only to companies on the official list of Qualified Recognised Overseas Pension Schemes (Qrops). And some of these have been exploited by scammers.

Continental Wealth Management is facing a £2.5million legal action in the Costa Blanca for using Qrops in alleged scams. Pension pots were poured into high-risk and complex products suitable only for professionals. The scammers then plundered the funds for huge commissions and savers who tried to withdraw what remained of their money faced crippling exit fees.

Susan Monaghan, who was one of the victims, said: ‘This formula is used over and over again in offshore financial services – and it makes plenty of commission for everyone involved but destroys the fund for the investors.

‘Being listed with HMRC lends credibility and that gave people reassurance.’ The Maltese authorities are considering 50 complaints about the Momentum Malta Retirement Trust, which accepted clients from CWM.

Miss Monaghan accused Momentum of failing in its ‘duty of care’ and allowing an insurance bond to be purchased that locked investors in for up to ten years and at great expense.

She added: ‘Momentum have known this for years with complaints being made as far back as early 2015 but they have continued doing the same thing since, allowing even more pensions to be destroyed.

‘They have allowed unqualified, unregulated firms to give investment instructions and despite seeing people’s funds go down, year on year, have done nothing.’

Julie Elsden, who lost almost her entire retirement fund after investing through Momentum with CWM, said she went ahead with her pension transfer only because it was HMRC approved.

She said CWM went to ‘great lengths’ to convince her of this and produced documentation with HMRC logos. ‘This situation has now left me with very little funds for my retirement,’ she added.

Stewart Davies, head of Momentum Pensions, said: ‘CWM collapsed over two years ago and since then, Momentum Pensions Malta – in conjunction with other advisers and trustees in the market – has assisted many consumers that have been affected.

‘We do not, and never have, provided investment advice and we do not choose or manage the assets which clients invest in.

‘Investment company documentation is also provided to all members at inception, which includes a clear cost disclosure and cancellation notice period.’

An HMRC spokesman said: ‘HMRC has done much to combat pension scams. We will continue to come down hard on scammers.’

It warns on its website that it is up to the person transferring their cash to check a scheme fulfils the criteria to be legitimate.

I put £64,000 in Malta scheme on HMRC’s list 

A grandfather lost most of his £64,000 pension pot after being persuaded to switch to an overseas scheme recognised and listed by HMRC.

Derrick Towlson, a former plumber and heating engineer, moved his money to the Malta-based scheme after being cold-called in 2013 by Continental Wealth Management.

The 63-year-old said the ‘big selling point’ was that the money would be put into the Momentum Malta Retirement Trust which is on HMRC’s list of recognised overseas schemes.

Derrick Towlson (pictured with wife Carol), 63, lost most of his £64,000 pension pot after being persuaded to switch to an overseas scheme recognised by HMRC. While he was told told his savings would grow to £80,000, he only got £19,000

He was told his savings would have grown to £80,000 by the end of this year – instead he has just £19,000.

Mr Towlson, who lives with wife Carol near Colwyn Bay in North Wales, said he had to pay huge fees and some of his cash was lost in high-risk investments. He is now withdrawing the cash but exit fees will cost him another £4,000.

‘This is destroying lives,’ he said. ‘The UK government has left the doors wide open for fraud and scams. There is such a lack of control, it’s incredible. It’s so lax. It’s giving the UK a really bad name across the globe.

‘The HMRC listing was a big selling point. You think it must be OK.’

Momentum said all investment costs were fully disclosed and authorised and verified by the pension members and their advisers. It also said it took action as soon as it discovered the problems with CWM.

Ex-model’s champagne life as firm went bust 

A company director accused of fleecing hundreds of Britons out of their pensions had ‘the sort of life most of us would give our right arm for’.

Jody Smart, also known as Jody Bell, flaunted her luxury lifestyle while customers of her Spanish-based firm Continental Wealth Management say they lost most of their retirement savings.

Many were persuaded to invest because CWM was listed on the HMRC website.

In September 2016 the former model appeared on the Channel 5 show How the Other Half Live – just a few months before her company went bust.

Jody Smart, also known as Jody Bell, ran Continental Wealth Management and left many people without their retirement savings. Three British claimants are pursuing combined £2.5million claims against Miss Smart, Mr Kirby and two others of aggravated fraud, fake accounting and belonging to a criminal organisation

Footage showed her at the Costa Blanca headquarters of CWM, which the programme said was worth £13million. She was also filmed enjoying a champagne picnic, driving a Mercedes and showing off her floor-to-ceiling shoe collection.

Presenter Eamonn Holmes told viewers: ‘The corporate world has given Jody the sort of life that most of us would give our right arm for. A stunning house in Spain, fast cars and a vast shoe collection.’

She was on the show to promote her fashion company, Jody Bell SL, which was funded almost entirely with money from CWM. The cash helped pay for her to travel to New York Fashion Week to present her outfits. A mother of two, she grew up in Herefordshire before moving to Spain where she started a relationship with CWM founder Darren Kirby.

Despite having no financial qualifications or experience, she became the sole director of the company. She was paid a salary of £122,000 a year, a Spanish court heard last month.

Three British claimants are pursuing combined £2.5million claims against Miss Smart, Mr Kirby and two others of aggravated fraud, fake accounting and belonging to a criminal organisation. The court has heard that when CWM went bust it had just £56,000 in the bank.

Yet from 2015 to 2017, hundreds of thousands of pounds was paid to her fashion label and to a property holding company registered in her name.

Miss Smart denied ever dealing with clients or having anything to do with the running of CWM other than promoting it in the Spanish media.

She said she visited the office in Denia occasionally because it had a room where she kept her designer clothes.

She and Mr Kirby, who did not respond to a court summons for cross-examination, did not answer requests for comment.