Beware Of Pension Scams
Last year, 180 people contacted Action Fraud to report that they had been the victim of a pension scam, losing on average of £82,000 each. This is probably the ‘tip of the iceberg’ as many people do not report when they have been scammed.
The Pensions Regulator and the Financial Conduct Authority have warned that more than 5 million pension savers (42%) are likely to fall for at least one of six tactics used by pension scammers, with the financially savvy just as likely to be fooled.
It is often people who are actively seeking ways to boost their retirement income that are more vulnerable to fall for scammers’ tricks.
Common tactics used by scammers:
- You receive an offer for high returns by investing in overseas properties, renewable energy bonds, forestry, storage units or biofuels
- You are called out of the blue by a company asking to discuss your pension plans
- You receive an offer to access your pension pot early
- You receive an offer guaranteeing returns of 11% on your pension savings
- You receive an offer for a free pension review from a company you have never dealt with before
- You receive an offer that is ‘time limited’ and the company offer to send a courier with the paperwork so that you can sign it immediately
Whilst these may seem obvious on their own, when they are built into a web of correspondence either through the post, email or by someone who sounds charming on the end of the phone it is easy to get drawn in. Cold calling is now illegal so if you do get a call that you have not requested put the phone down.
Other things to consider:
- Reject unexpected pension offers whether made by letter, email or phone
- Do not be rushed or pressured into making any decision about your pension – consider getting impartial information and advice
- Check who you are dealing with before changing your pension arrangements – Check the FCA register or call the FCA contact centre on 0800 111 6768 to see if the firm you are dealing with is authorised by the FCA.
- Listen to your gut – our gut instinct is so often right
Savvy Financial Planning is registered with the Financial Conduct Authority (504571), we can advise you on any aspect of your pension or retirement journey.