New research suggests that 42% of pension savers, which would equate to over five million people across the UK, could be at risk of falling for at least one of six common tactics used by pension scammers.
The findings, which come from research conducted by The Financial Conduct Authority (FCA) and The Pensions Regulator (TPR), also revealed that among those who said they were actively looking for ways to boost their retirement income, the likelihood of being drawn into one or more scams increased to 60%.
The most common tactics employed by scammers include cold calls, exotic investments, a free pensions review, claims of guaranteed high return, time-limited offers and early access to your pension pot before age 55.
Despite the government’s ban on pension cold-calls this January, 23% of all those surveyed said they’d talk with a cold-caller that wanted to discuss their pension plans.
Pension scams are a very real threat, especially to those with significant levels of pension savings. According to statistics, victims of pension fraud in 2018 lost an average of £82,000. However, any loss of funds that you spent your working life building up can be devastating.
The advice to help avoid falling victim to pension fraud is:
- Reject unexpected pension offers whether made online, on social media or over the phone.
- If you are at all concerned or suspicious, you should check to see if the firm you are dealing with is authorised by the FCA before changing your pension arrangements. You can do this by reviewing the FCA Register or calling the FCA contact centre on 0800 111 6768.
- Don’t be rushed or pressured into making any decision about your pension.
- Consider getting impartial information and advice from an independent Chartered Financial Adviser. Those aged 50 can access free independent advice via the government-backed Pension Wise service.
The FCA has a warning list tool – designed to help you check the legitimacy of an offer or approach.
The Pensions Regulator has produced a handy leaflet that runs through the common ways to spot a scam and how to protect yourself from fraudsters.