FSA warns consumers over pension loan schemes

PRPs involve investors under 55 transferring their pensions to an overseas master pension. The provider then loans the individual 50% of the value of their pension fund from another master pension, effectively lending them part of their fund. Often the arrangements require investors to pay back their loan at high interest rates, and allow the providers to put the remaining 50% of the pension funds in obscure offshore investment vehicles. In a warning issued today, the FSA said: "[Pension unlocking] schemes claim no tax is payable from the money you take as cash. However, it is not ...