1.8m over 50s targeted by scammers in the last three months
We all have a responsibility to be on constant guard, but the basic rule of thumb still stands, if an opportunity sounds too good to be true, it almost certainly is
Retirement Advantage, the retirement specialist, has revealed that 1 in 5 people (18%) aged 50 or over1 has been targeted by a potential scammer in the past three months. This equates to 1.8m people who have been offered unsolicited free pensions advice or investment opportunities by phone, text or email.
Andrew Tully, pensions technical director at Retirement Advantage, said: ‘The pension freedoms have opened the floodgates for scammers and conmen to prey on people who are keen to access their pensions. These scammers are using increasingly sophisticated and convincing ways of trying to defraud large amounts of cash from people’s hard earned pensions and savings.
‘Attempts by the industry and regulators to prevent scams is not preventing huge sums of money2 disappearing into the scammers pockets. My concern is the reported fraud and scams is only the tip of the iceberg as many people are unaware they’ve been conned or are too ashamed to come forward and report it.
‘The Government, prompted by pressure from the financial industry, has promised to ban pension cold calling. This is a positive move, but we need to keep the pressure up to make sure this comes back onto the government agenda as soon as possible.
‘We all have a responsibility to be on constant guard, but the basic rule of thumb still stands, if an opportunity sounds too good to be true, it almost certainly is.’
Retirement Advantage is highlighting key things to be alert for:
1.An offer to help you access your pension savings before age 55. It is only possible to do this in rare situations, for instance if you are very ill, so be careful and always check with your pension provider.
2.A recommendation to take a large amount of money, or your whole pension pot, in a lump sum and invest it. There are significant tax implications if you take lots of your savings in one go, so check the tax position before you make any decisions (tax calculators are available online http://www.retirementadvantage.com/pension-tax-calculator
3.Warnings that the deal is limited and you must act now. Choosing the right retirement income product(s) is a big decision and shouldn’t be done quickly or under pressure.
4.You are discouraged from seeking professional financial advice or talking to Pension Wise or The Pensions Advisory Service (TPAS). An adviser would be able to explain the rules and tax implications of different options and help you make the best choices for your personal circumstances, so be very suspicious if this is discouraged.
5.Contact by somebody who is not on the Financial Conduct Authority (FCA) Register. The Register is a public record of all the regulated firms and individuals in the financial services industry, including retirement income providers and investment companies https://register.fca.org.uk/
6. Check the FCA ScamSmart warning list for known scams (http://scamsmart.fca.org.uk/), and use the TPAS tool to help identify a potential scam. (https://tkd.pensionsadvisoryservice.org.uk/tkflow_live/Flow.aspx?f=PensionScams).
7. Check with your financial adviser, TPAS or your current pension provider if you have concerns, or call Action Fraud on 0300 123 2040 or online at actionfraud.police.uk.
- Research was conducted by Censuswide between 28/06/2017 and 29/06/2017. Online interviews were conducted among 1,005 people aged 50 and over, yet to retire, who have some form of private pension savings.
- Source: https://www.ft.com/content/4b4fba9c-3707-11e7-bce4-9023f8c0fd2e