A company that ran 15 pension schemes has been forced to suspend trading by the High Court, raising fears that hundreds of savers may have lost their money for good.
Fast Pensions and five other related firms have been placed in provisional liquidation following an investigation by the Insolvency Service. Fast Pensions is the sponsoring employer of 15 pension schemes where it is thought around 250 people have invested sums adding up to millions of pounds overall.
Last year, Telegraph Moneyreported how some Fast Pensions savers had been blocked from accessing their money. Over the past three years The Pension Ombudsman, which rules on complaints relating to workplace pensions, has upheld over 20 complaints against the firm.
Almost all the cases involve investors who have become alarmed after they stopped receiving annual statements and found it impossible to get information on their savings.
At the time, Sara Moat, a director at the firm, said the rules of the scheme meant investors could not move their money until at least five years had passed since their original investment. For some people that deadline has now passed but the money is yet to be released.
Andrew Muir, 38, moved £20,000 from a personal pension into a scheme operated by Fast Pensions in 2013. He became concerned last November when he was told he could not access his money.
Things got worse when he received a letter from HM Revenue & Customs demanding £800 in tax because he had supposedly made withdrawals from his pension before the minimum age of 55. Yet he said he has yet to receive any income from the Fast Pensions plan.
"You feel so stupid," said Mr Muir, a car valet. "That was my kids' future – I'm resigning myself to having lost it all."
Mr Muir made his investment after clicking on an ad on Facebook. Other investors were advised to consolidate their savings with Fast Pensions by financial advisers. One, who has around £60,000 at stake and wished to remain anonymous, said she had received assurance as recently as last month that her money would be paid out.
She said: "They have been managing my expectations for months that I'd get my money back. They've sounded completely genuine, so I've taken it at face value.
That was my kids' future – I'm resigning myself to having lost it all
The Insolvency Service said savers should contact a lawyer, regulated financial adviser or The Pensions Advisory Service (Tpas), a Government-funded free service.
Michelle Cracknell, Tpas chief executive, said anyone who consulted a financial adviser before placing money with Fast Pensions should first complain to the firm, then the Financial Ombudsman Service. If the advice firm has since gone bust, they may be able to make a claim with the Financial Services Compensation Scheme.
Ms Cracknell added: "Our service can also give guidance to members of the public to help them understand what has happened to their pensions and where appropriate actions they can take to rebuild their savings assuming that they lose all of their pension pot."
A petition to wind up the companies will be heard in the High Court on 30 May 2018. Assuming an order to wind up is granted, the Official Receiver will take over the companies and distribute any recoverable assets to creditors and investors.
Fast Pensions did not reply to a request to comment.
Protecting your pension
Last month, the Government promised to ban pensions "cold calling" by June, following a campaign spearheaded by this newspaper.
Last year, the Government pledged to bring a ban into law but the proposed ban was not included in a slimmed-down Queen’s Speech which set out the Government’s priorities. Pension savers have long been the target of fraudsters.
Often the scams have revolved around ways to “liberate” pensions, which normally cannot be accessed under the age of 55. Fraudsters convince savers to transfer their pension to a new scheme from which money can be released, they claim, without incurring huge tax bills.
Once out of the oversight of a legitimate scheme, rogue advisers typically recommend esoteric investments in “illiquid” and high-risk assets such as hotel rooms, car parks and storage “pods”.
In many cases pensions are lost entirely. The “pension freedoms”, which allow over-55s to cash in their entire pot, have led to a surge in pension fraud cases.