Pension scams are on the increase. Every day criminals use sophisticated ways to con pension savers out of their money. There has been an increase in scams since the onset of COVID-19, as people who are worried about the state of investment markets have been transferring their pension savings to other investments.
Scammers will often start by offering a ‘pension review’ or a ‘one-off investment opportunity’. Eventually, this ‘offer’ will depend on you transferring your pension savings out, supposedly to another pension scheme but in reality, straight into the scammers’ pockets. You could lose all your pension savings and possibly also find yourself with a huge tax bill.
Things to watch out for
- Any contact about your pension that comes out of the blue, even if the caller claims to be from your bank or a government department.
- Claims that you can get at your pension savings before age 55 without paying large amounts of tax. You can’t.
- Website promotions, telephone calls, text messages or adverts encouraging you to transfer your pension savings to get cash or a loan.
- Offers of ‘one-off’, ‘unique’ or ‘time-limited’ investment opportunities—especially if they involve transferring money abroad.
The FCA has produced a short video highlighting how pension scammers work. You can watch it here.
Avoiding and reporting scams
- Don’t sign anything or transfer money without speaking to the Pensions Advisory Service on 0800 011 3797.
- If you think you’ve already fallen victim to a scam, call Action Fraud on 0300 123 2040.
- Check who you’re dealing with before changing your pension arrangements. Check the ScamSmart website (fca.org.uk/scamsmart) or call 0800 111 6768 to see if the firm or person you’re dealing with is authorised by the FCA.
- You can find more information about pension scams at moneyandpensionsservice.org.uk