Scammers are targeting pension pots of all sizes and taking advantage of the global pandemic and people’s concerns around their financial future in order to persuade them to part with their hard earned money. Here’s some important information on what you can do to avoid being a victim of a pension scam.
Pension scams can be hard to spot. Scammers can be articulate with credible websites, testimonials and materials that are hard to distinguish from the real thing.
Their impact can be devastating. Last year, victims of pension scams lost on average £91,000 each.
To help you spot the signs and protect yourself from a scam, the Financial Conduct Authority (FCA) and Pensions Regulator suggest following four simple steps.
Step 1 – Reject unexpected offers
If you’re contacted out of the blue about a pension opportunity, chances are it’s a scam. Pension cold calling is illegal, and you should be very wary. An offer of a free pension review from a firm you’ve not dealt with before, is probably a scam.
Step 2 – Check who you’re dealing with
Search ScamSmart and check the FCA’s register to make sure anyone offering you advice is authorised. If they are, check they’re permitted to give pension advice by calling the FCA Consumer Helpline on 0800 111 6768.
If you don’t use an FCA-authorised firm, you risk not having access to compensation schemes.
Step 3 – Don’t be rushed or pressured
Take your time to make all the checks you need – even if this means turning down what seems to be an ‘amazing deal’.
Step 4 – Get impartial information or advice
You should seriously consider seeking financial advice before changing your pension arrangements. In some cases, for example where you are wanting to transfer more than £30,000 from a DB scheme, you must obtain this advice.
Consider using The Pensions Advisory Service which provides free independent and impartial information and guidance.
If you suspect a scam, report it.
You can report an unauthorised firm or scam to the FCA using the online reporting form or on 0800 111 6768,
If you suspect a scam, report it to Action Fraud on 0300 123 2040 or at www.actionfraud.police.uk.
Be ScamSmart with your pension. To find out more, visit www.fca.org.uk/scamsmart