Pension fraudsters who used ‘detailed and careful lies’ to steal £3.7m jailed
Two key figures behind an elaborate pensions scam have been jailed for their role in duping 74 victims out of more than £3.7 million in savings following a complex investigation by the Yorkshire and Humber Regional Organised Crime Unit (YHROCU).
Daniel Giles, 51, of Jacob Drive, Coventry, was sentenced to 11 years in prison, while his associate, Mohammed Bashforth, 62, of Spen Lane, Gomersal, formerly of Wakefield, received a five-year jail term at Leeds Crown Court on Friday (January 9).
Both men were also disqualified from being company directors for 12 and five years respectively. A third man, Kevin Phelan, 62, of Gillygooly Road, Omagh, Northern Ireland, will be sentenced at a later date.
The trio was found guilty of conspiracy to commit fraud by false representation and conspiracy to cheat the public revenue in August last year.
Operating out of premises in Leeds and Wakefield between 2013 and 2015, the fraudsters devised a scheme that falsely promised investors “early tax-free access” to their pension funds, claiming the money would be safely invested for the future.
The scam, known as “pensions liberation”, used professionally produced brochures and marketing materials to lure victims. They offered cash-back incentives and concealed the crucial detail that early pension access of this nature is not tax-free, but is subject to tax of up to 55 per cent.
In total, 84 victims were persuaded to transfer over £3,701,813.92 into bank accounts controlled by the trio. In addition to stealing the investors’ money, which was hidden behind bogus transactions, the group also defrauded HM Revenue and Customs (HMRC) out of an estimated £700,000 in unpaid taxes.
During the trial, the court heard that Giles and Phelan were the masterminds of the schemes, which Bashforth then operated. They employed a network of ‘introducers’ and used “detailed and careful lies” to circumvent legitimate pension companies and gain control of the customers’ money.
Ramona Senior, head of the Yorkshire and Humber Regional Organised Crime Unit, commented on the outcome: "Driven by greed, they sought access to pension holders’ cash and treated the funds they obtained as pots of money which they dipped into at will, with no intention to properly invest the funds or highlight the tax liabilities created.
“They had no care or concern as to the financial hardship this would cause victims.”
Daniel Giles also admitted to a separate charge of tax evasion relating to over £1 million in unpaid personal tax.
Anthony Burke, Deputy Director at HMRC, used the case to issue a warning: “This police investigation underlines the serious consequences for those who defraud people of their pension savings through so-called liberation schemes.
“Anyone considering transferring their pension should seek professional advice first and be wary of schemes promising early access to pension funds, as these often result in significant tax charges.”
West Yorkshire Police added that further action will now be taken under the Proceeds of Crime Act.