Pension savers have long been a target for fraudsters, with high returns for successful scams: the FCA says that pension scam victims lose an average of £82,000. The situation has worsened during lockdown, with research5 indicating that 64% of pension transfers are now showing at least one warning sign of a potential scam.
Keeping yourself safe
Fraudsters are becoming increasingly sophisticated in their methods and scams can be harder to spot than you might think. So, learning to spot the signs is an important part of keeping yourself safe:
1. Contact via cold call If you’re contacted out of the blue, be on your guard. Pension cold calling was banned in 2019, so treat unsolicited contact with extreme caution.
2. ‘Too good to be true’ claims Scammers will usually make attractive promises, e.g. that they can get you high returns for little risk, or that they know of special loopholes to help you save more tax.
3. Pressure to make speedy decisions Rushing victims into a hasty decision is a common scamming tactic, so if you feel like you’re being pressured, slow down and think – no matter how good the opportunity may seem.
Stop and check
Action Fraud have urged consumers to seek regulated advice on investment opportunities. If you have been approached by phone, email, social media or face-to-face, it really does pay to be suspicious, trust your instinct and:
• Seek professional advice before making a significant financial decision
• Use the Financial Conduct Authority’s register to check if a company is regulated
• Remember that, if something sounds too good to be true, it probably is.
For more information about investment fraud, visit www.fca.org.uk/scamsmart. 5 XPS Pensions, 2020
It is important to take professional advice before making any decision relating to your personal finances. Information within this page is based on our current understanding and can be subject to change without notice and the accuracy and completeness of the information cannot be guaranteed. It does not provide individual tailored investment advice and is for guidance only. Some rules may vary in different parts of the UK.
Tax and Estate planning are not regulated by the Financial Conduct Authority
The value of pensions and investments can fall as well as rise. You may get back less than you invested.
Will writing is not regulated by the Financial Conduct Authority.
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