Effort launched to make financial crime a UK election issue

Campaigners representing British victims of financial scams, including offshore pension scams,  are calling on members of Parliament and candidates for UK office to make financial crime a campaign issue, in the run-up to the UK’s 8 June snap election. 

In particular, the campaigners are calling for a change in legislation that would end the current phenomenon of individuals being held liable for UK tax in certain types of financial crime cases, rather than the perpetrators, and see the fraudsters in such cases “pursued vigorously”, rather than allowed to continue stealing peoples’ savings, according to Angie Brooks.

Brooks is the founder of a pension fraud victims’ campaign group, Pension Life, and one of the instigators of the current effort to get lawmakers and regulators involved in bringing about what she says is long overdue legal and regulatory change.

“The US provides tax reliefs for victims and pursues fraudsters vigorously,”  says Brooks, a Briton who is based in Spain.

“But in the UK, it is the victims of pension and investment fraud who get pursued, by HMRC, for tax liabilities, while nothing is done to go after the people who stole these victims’ pensions and invstements, and left them to the mercy of the taxman.”

Greg Mulholland, pictured – a Liberal Democrat who has represented the Leeds North West constituency as an MP since 2005, and who counts a number of victims among his constituents – is supporting Brooks and the fraud victims’ cause. On Wednesday, he tabled an early day motion in the House of Commons, seeking the support of fellow MPs for the initiative.

Early day motions, also known as EDMs, are motions submitted for debate in the House of Commons for which no date has been fixed, and which may not ever be debated. They are typically introduced in order to generate public interest and attention to causes, and to give campaigners a formal means of showing UK lawmakers the support that exists for their cause, since supporters are able to sign them.

Already a number of MPs have pledged support from both the back and front benches, Brooks says, including Fabian Hamilton, a Labour MP for Leeds North East.

Mulholland’s EDM, which may be viewed by clicking here, notes that many victims of fraud, who have been mis-sold investment schemes and pensions, “are being aggressively pursued by HM Revenue and Customs for tax liabilities resulting from that fraud”; “have not made much, if any, financial gain and in most cases have actually lost funds, with some being very large sums”, unlike those perpetrating the fraud, who “have made huge amounts”; and calls on the Government “to introduce a tax exemption” in existing legislation “for victims of fraud in respect of tax liabilities that have arisen as a result of…fraud”.

Mulholland’s EDM also calls on the government “to create an independent specialist task force to investigate how victims of fraud and mis-selling are being treated under tax avoidance and pensions legislation by HMRC, and who should rightfully be responsible for the stolen tax”.

‘Bring our law in line’

In other words, Brooks says, the goal is to “fix” the UK’s legislation so it is “in line with legislation in other countries” with respect to the way it treats victims and perpetrators of financial crime.

She says she has numerous examples of individuals who, having lost their pensions in elaborate “pension liberation” schemes, are now being told by HMRC that they owe “crippling” amounts of tax.

“I hope as many victims as possible will approach their MPs and parliamentary candidates, and help to make this a strong and effective campaign,” Brooks adds.

“If the parties agree to include this issue it will be very newsworthy; if they don’t it will be equally newsworthy.”

ABOUT THE AUTHOR
Helen Burggraf
Helen Burggraf is the editor of International Investment. A US-trained journalist, she has worked in Rome, New York City and London, covering everything from the fashion and retailing industries to the global drinking water and water-treatment sector, private equity, and most recently, the international cross-border financial services/advice industry.

Read more from Helen Burggraf

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