With it recently being reported in the media that pension scams have cost savers over £20m in the last 2 years, it’s important to be aware of who is behind the mask when it comes to disclosing any of your personal or financial details.
Spot a Scam
The average victim of a pension scam loses tens of thousands of pounds. This could mean losing the retirement you worked hard for and banked on having. Being aware of the warning signs of scams can protect you and your finances from ruin, these include:
- Cold calls, text messages or contact out of the blue with promises of quick cash, legal loopholes and pension loans
- Claims of accessing your pension before age 55
- Promises of high or guaranteed returns
- Free pension reviews
- Transfers of your money overseas
Every little helps when it comes to cash, particularly as our purses are stretched, but promises that sound too good to be true are usually red flags, especially when it comes to your pension.
Scammers use sophisticated methods to offer attractive, quick cash gains and may come across as professional, approachable and authentic. They may even have official-looking marketing materials and testimonials. You might feel under pressure to make a decision with scammers trying to spur you on,
Many of the investments that scammers offer are unusual, high-risk investments such as forestry and parking lots which might ring alarm bells, but some could sound more appealing such as renewable energy bonds and overseas property. Regardless of the investment, all scams pose a threat.
Steps to Avoid Becoming a Victim
These 6 steps could help you avoid becoming a victim of a pension scammer:
- Never give your financial or personal information to a cold caller.
- Find out about the company's background. Any Financial Advisers should be registered with the Financial Conduct Authority (FCA).
- Ask for a statement showing how your pension will be paid at retirement, and question who will look after your money until then.
- Speak to an advisor who is not associated with the proposal you have received, for unbiased advice.
- Take your time and never be rushed into a decision.
- All pension savers should speak to an independent FCA-authorised adviser before making any transfers with their pension.
The FCA is the professional body which regulates firms and individuals that provide financial advice meaning it can provide details of authorised advisors.
Looking to Transfer?
The Government has identified common pension scam risks which, if present, may suggest you are in danger of being scammed. These are called red and amber flags. If you wish to transfer your pension, we must assess whether any red or amber flags are present. In order to make this assessment, we may request more information. We will only ask for information that we reasonably need and will only use it for this purpose.
If there are any red flags present, we must refuse the transfer. If there are any amber flags present, the transfer will be paused until you attend a pension scams appointment with MoneyHelper. MoneyHelper offers free, impartial guidance backed by the Government on money and pension choices. The purpose of this appointment is to help you identify the risk involved with transfers, highlight the dangers of pension scams and help you consider whether you still wish to transfer. These extra checks were put in place to help identify scams and ultimately protect more people from losing money.
Protect Your Pension
If someone calls claiming to be from the Pension Fund, ask for their name, hang up and then call our helpline 01224 045 045. We will be able to confirm any genuine enquiries.
A reminder that the Fund will never call members to ask for their bank details. If we have any questions about bank details we would email or write to you. Similarly we do not accept bank detail changes over the phone.