This month has seen some interesting developments on the scams front. Firstly, I got my election wish for a Fraud Minister. The new government has recognised the devastating impact of fraud on people, companies and the economy and has appointed Lord Hanson to lead on our national fraud strategy with much needed oomph to get things done (I hope!). According to Crowe, in 2023, private sector fraud of all types cost the economy £157.8 billion. Public sector adds over £50 billion. Pension fraud alone costs approximately £6 billion a year, with losses to individuals, employers, as well as the state. With have a £22 billion black hole in the economy causing such strain on public services, there can surely be no excuse for letting so much of the wealth of the country slip away to criminal activities. We need to get a grip and do it now.

PSIG has done its bit to help over the last 10 years, raising the standard of scam prevention and raising awareness in the industry keeping countless £millions out of scammers’ hands, but it never seems enough. We need others to do their bit too, including government.

This month I have also been listening to several people, some from government, law enforcement and charities who want to make things tougher for scammers, to pursue financial crime and most importantly to help victims. There are positive works in the pipeline which together could make a big difference. It’s about time, but I fear we might spend too much time analysing, planning and fighting for resources that we miss some early opportunities.

We had some more positive news, with Dalriada partnering with Standard Life Master Trust to accept assets recovered and compensation to the Ark Schemes, one of the biggest pension liberation scams dating back to the early 2010’s. Yes, 14 years later we are getting closer to a partial resolution of this egregious scam which destroyed the lives of hundreds of victims.

But it is not all good. I am delighted that the Fraud Compensation Fund (FCF) has accepted that the scheme lost its valuable assets because of fraudulent actions by managers and advisers and will compensate for those losses, including reasonable costs incurred by the TPR-appointed trustee. This is the good news. What is not good news is that the FCF cannot compensate for loss of investment returns or for the cost of the normal running of the pension scheme while solutions are sought. That’s 14 years of returns and fees gone forever. It shouldn’t have taken so long to conclude what was clear from the outset. In the meantime, no one has gone to jail (not that jail is the answer), but the victims have not had justice.

Despite the relief that the FCF has come to the right conclusion, the law and the courts continue to punish the victims who have lost their savings as well as the potential return on those savings. In 2020, a tax tribunal concluded that HMRC has the right to levy a tax charge, plus interest, on those who were deceived into transferring their scheme benefits to a scam scheme. HMRC has been trying to get tax from victims (many of whom have no money) for over a decade and have been reinforced by the tax tribunal finding. They have restarted the collection process in early September, adding to the huge mental and financial stress suffered by victims already. This is despite a number of us trying very hard to get HMRC to delay collection activities while we work out a better solution or come to a deal for those victims.

We were in dialogue with HMRC, but the unexpected general election stopped the activity and HMRC have not re-engaged since, despite asking several times for them to do to the decent thing. We have written to HMRC and government ministers, but they all ignore us. This is simply not good enough.

We have a new Fraud Minister. It is time for him to step up to the plate and help these victims who are now past retirement age. It is time for HMRC to grow some public spirit and help us find a solution. The cost of peace of mind for up to a thousand such victims is around £20 million – in reality mere pocket money for government. I hope they are listening and I hope that those who can, add their voice to calls for a change in approach.

I am drafting a new public petition is to replace the one which was taken down earlier, so watch out for it and please sign to show your support!

Margaret Snowdon, Chair PSIG