17 Jul 2019

Warning: Scammers are now targeting pension pots of all sizes

Warning: Scammers are now targeting pension pots of all sizes

The national fraud and cyber crime reporting centre is warning that scammers are now targeting pension pots of all sizes.

Action Fraud wants you to know the warning signs and how to keep your hard-earned savings safe.

However, pension scams can be hard to spot.

The centre says that fraudsters can be articulate and financially knowledgeable - with credible websites, testimonials and materials that are hard to distinguish from the real thing.

Scammers usually contact people out of the blue via phone, e-mail or text, or they even advertise online.

Action Fraud highlights that fraudsters will design attractive offers to persuade people to transfer their pension pot to them, or to release funds from it.

The money may be put into in unusual and high-risk investments like overseas property, renewable energy bonds, forestry or storage units.

Alternatively, your savings might be invested in more conventional products, but within an unnecessarily-complex structure which hides multiple fees and high charges.

Or your cash might simply be stolen outright.

What to look out for

Scam offers often 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 fraud).
  • 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 - they 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.
  • Long-term pension investments - which mean it could be several years before you realise something is wrong.

How to protect yourself

Action Fraud says there are four simple steps to protect yourself from pension scams:

  • Step one - reject unexpected offers.
  • Step two - check who you're dealing with.
  • Step three - don't be rushed or pressured.
  • Step four - get impartial information or advice.

The public are urged to report any suspected scam to Action Fraud on 0300 123 2040 or at www.actionfraud.police.uk

If you've agreed to transfer your pension and now suspect a scam, contact your pension provider straight away. It may be able to stop a transfer that hasn't taken place yet.

If you are unsure of what to do, contact The Pensions Advisory Service for help on 0800 011 3797.

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