11 May 2020

Beware of pension scams...

Beware of pension scams...

If it seems to good to be true, it probably is.

When looking for advice relating to retirement planning, it is imperative that you seek advice from someone regulated by the Financial Conduct Authority (FCA). This ensures that they are qualified and authorised to give you advice and that you are protected under the Financial Services Compensation Scheme  (FSCS).

There are companies offering  ‘excellent’ investment opportunities, access to pension before age 55 and pension loans which unfortunately are too good to be true.

In addition to potentially losing your life savings, you may also face an unauthorised payment tax charge from HMRC for entering into unregulated pension plans.

Example (source The Pension Regulator)

Ruby, aged 53, was looking to free up some money to help with her son’s university fees. She found a website offering 5% of her fund now and a guaranteed 8% growth on the remainder. After signing up, Ruby received £5,700 and a welcome letter. A year later Ruby was interested to see how her pension was doing. However the number she telephoned had been disconnected and after speaking to Action Fraud realised that she had likely lost £107,000. On top of this, HMRC advised that she was liable to pay an unauthorised payment tax charge of £62,700.

What should you look out for?

  • Companies offering access to your pension funds before age 55. Unless, on grounds of ill health, it is highly unlikely a legitimate scheme;
  • Offers of ‘once in a lifetime’ investment opportunities;
  • Pension monies being transferred overseas; and
  • A rush to transfer pension funds involving couriers being sent to get your signature.


If you are unsure if you have been or are being targeted by such a company, you can contact Action Fraud to clarify.

To ensure that you receive, authorised advise, make sure that your financial adviser is authorised by the FCA. All advisers can be found here http://www.fsa.gov.uk/register/home.do

Don’t rush into any decision as any action you take is likely irreversible.

Aberdein Considine is authorised and regulated by the Financial Conduct Authority. If you would like to speak to us about your pension, click here.

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