Unscrupulous QROPS advisers face naming and shaming

Advisers and QROPS schemes face being shopped to regulators under a crackdown by New Zealand IFAs.

A group of what has been described “senior advisers” in the country has established a working party through which it hopes to clean-up parts of the QROPS industry.

The group will primarily target other advisers and pension schemes that are promoting New Zealand QROPS as a means for savers to receive 100% of their pension pot in a tax-free lump sum.

Those responsible for the initiative fear such activities could see their country suffer the same fate as Singapore, which in 2008 effectively had its status as a permissible QROPS jurisdiction withdrawn by HMRC.

Geraint Davies, chief executive of UK-based QROPS specialist Montfort International, is working with his Kiwi counterparts in the group.

He said: “They are going to put pressure on the local regulator and government and make them aware these things are happening and get them to take action. These are high-profile, well-respected advisers and I’m sure the authorities will sit up and listen.”

Davies added the advisers wanted to create some form of officially backed advice process or code of conduct for QROPS business to ensure it was conducted “properly” for genuine retirement planning.

“They don’t want to see New Zealand get a bad name because of certain so-called advisers and scheme promoters who are just flogging a ‘get your pension cash out’ job and who are only trying to make a fast buck for themselves,” he said.

Davies said the group, whose membership and objectives will be officially made public later this month, would be presenting evidence of poor practice to local pension and tax authorities in a form of naming and shaming.

“They also want to get the message back to HMRC that they are treating this matter seriously,” added Davies.

HMRC is believed to have had concerns about some QROPS schemes based in New Zealand for some time, primarily because it is possible to take 100% tax-free lump sums under local rules in the country.

However, it is not known to have acted against any particular scheme by removing it from the list it publishes of self-certified QROPS.

For expert QROPS advice go to http://www.qrops-advisers.com or call 01664 444625

http://www.international-adviser.com/article/unscrupulous-qrops-advisers-face-naming-and-shaming