Sadly, pensions are a soft target for fraudsters and it appears that this is the case, yet again. The innate complexity of pensions (hopefully to be addressed to one degree or another this year in an assortment of government-commissioned reviews) and the understandable temptation experienced when offered the opportunity to "liberate" a sizeable chunk of money that would otherwise be locked away until retirement when there are other pressing financial needs can, when combined, cause disastrous irrecoverable loss to unwary individuals.

So how do you find yourself falling foul of the latest successful attempt to dupe pension money out of the often cash-strapped unwary? Well, firstly you allow yourself to be set up as a bogus employee of a registered company. This company then requests your real employer, trustees or pension provider to transfer your pension fund or the cash value of your pension benefits to its own approved pension scheme.

The exact details of what happens next are, unsurprisingly, hazy but it seems that you will then receive an immediate cash sum in return (this is so-called "liberation" or "busting" of your pension fund). However, the new pension scheme takes a "commission" (in this case, according to OPRA, the pension regulator) in the order of 20% - 30% from your pension monies. In addition, if the Inland Revenue finds out and can prove abuse of its tax relief for pension schemes (see below), it will also take away the tax approval and levy a 40% tax charge, meaning that 70% of the fund could be lost. Even if it does not, the remaining pension funds may well (as appears to have happened in the present case) be sent overseas and will, probably, be irrecoverable by the transferring individuals. A real recipe for short-term gain but long term pain.