Savers are warned to remain vigilant to protect pensions

Action Fraud is warning savers to remain vigilant and protect their pensions, as figures from the national reporting centre for fraud and cybercrime reveal £1.8 million has already been lost to pension fraud so far this year already. They have launched a national awareness campaign (Tuesday 20 April 2021) to remind the public about the importance of doing your research before making changes to your pension arrangements.

On their website they highlight that scams can include:

• free pension reviews
• higher returns – guarantees they can get you better returns on your pension savings
• help to release cash from your pension even though you’re under 55 (an offer to release funds before age 55 is highly likely to be a scam)
• high-pressure sales tactics – the scammers may try to pressure you with ‘time-limited offers’ or even send a courier to your door to wait while you sign documents
• unusual investments – which tend to be unregulated and high risk, and may be difficult to sell if you need access to your money
• complicated structures where it isn’t clear where your money will end up
• arrangements where there are several parties involved (some of which may be based overseas) all taking a fee, which means that the total amount deducted from your pension is significant
• long-term pension investments – which mean it could be several years before you realise something is wrong

This provides a lucrative opportunity for fraudsters. Pension freedoms, though enormously popular with consumers, have created a potentially lucrative opportunity for fraudsters, and people need to be vigilant to safeguard their hard-earned retirement savings. If it sounds too good to be true, then it usually is, and people should be sceptical of investments that are offering unusually high rates of return or which invest in unorthodox products which may be difficult to understand.

Four simple steps to protect yourself from pension scams

• Reject unexpected offers – don’t be swayed by a fantastic return from a company you have never heard of.
• Check who you are dealing with – If you get a call from your bank or credit card provider then put the phone down and us a different phone to phone them back. Chances are they didn’t call you.
• Don’t be rushed or pressured in to doing or accepting something – take your time to check everything out and never worry about an amazing time sensitive deal.
• Always get impartial advice or information - If in any doubt, seek advice from a regulated professional financial adviser or information/guidance from The Pensions Advisory Service

You can report suspected frauds on the ActionFraud helpline 0300 123 1047 or online at www.actionfraud.police.uk/report_fraud, and more advice is available at www.thepensionsregulator.gov.uk/pension-scams 

If you do receive a call about a pension review then ensure you ask who they work for and their FCA number. Then check on the FCA website - https://register.fca.org.uk/s/ - before contacting them back. A registered independent adviser is covered by the Financial Ombudsman Service and the Financial Services Compensation Scheme.

At Armstrong Watson Financial Planning & Wealth Management we are a firm of Chartered Independent Financial Advisers. We provide personalised financial advice to our clients and you can be safe in the knowledge you are dealing with a firm, and an adviser, who is authorised and regulated by the Financial Conduct Authority. Firm reference number 542122.