24 Jun 2022
The pension landscape changed for the better back in 2015 as the government allowed consumers to have more flexibility and a wide range of options as to how they can access defined contribution pension at retirement.
Whilst this news was long overdue and welcomed by most, there are a number of people in society who try to take advantage of such good news by to scamming people out of their built up retirement pots. The average loss in 2021 by pension scam victims was circa £51,000 according to complaints filed with Action Fraud; this was more than double the average from 2020.
Pension scammers take a lot of effort in trying to make themselves look like legitimate business and tend to have very convincing websites and marketing collateral.
There are many things to look for if you are approached by an individual or business out of the blue and a list of the tell-tale signs which mean that this contact could be a scam are:
- Since January 2019, there has been a ban on cold calling about pensions
- When a firm or individual won’t leave a contact number for you to call them back
- When you are pressured to make a quick decision
- When contact details are given but only a mobile phone number or PO box address are used
- When they claim to be able to help you ‘unlock’ your pension before the age of 55
- When claims about tax loopholes are made
- The offer of guaranteed high returns are made
To help consumers check to see if an investment or pension opportunity they’ve been offered is legitimate, the Financial Conduct Authority (FCA) have recently launched ScamSmart. ScamSmart is a very simple three question system that when answered will give the consumer a high level view on whether the offered opportunity is likely to be real or not. The system also gives practical guidance on what steps the consumer can take to validate the authenticity of the approach that has been made. ScamSmart can be accessed at the following link https://www.fca.org.uk/scamsmart
If you feel that you may have been a victim of a scam or have received an approach that you are not too sure about, we strongly recommend that you report it to ‘Action Fraud’ by calling 0300 123 2040.