Illicit ISA refunds

The UK Government has pushed its tax-free retail investment scheme, the Independent Savings Account (ISA), very heavily. Investment manager administration centres come under immense pressure towards the end of the tax year to complete registrations as small investors rush to beat the 5 April deadlines for using up their UK£7000 tax-free allowance. Some sharp fraudsters have seen opportunity in this frantic activity. The City of London Police is currently investigating over thirty cases in which stolen credit cards were used in the run up to the April deadline to purchase an investment which was subsequently cancelled in the 14-day grace period during which the investor is permitted to change his mind. Fund management firms are meant to refund through the card account but in the flurry around the deadline some issued cheques instead. A police spokesman said that there could be far more cases than those under review but fund managers were probably not disclosing the true extent of the fraud for fear of reputational damage.