The Financial Conduct Authority (FCA) and The Pensions Regulator (TPR) have launched a joint TV advertising campaign, revealing that the average victim of a pension scam lost £91,000 in 2017. They add that they believe only a minority of victims ever report the matter to the authorities.

The campaign, known as ScamSmart, is principally targeted at individuals aged 45 to 65, as the regulators say that this age group are most at risk of falling victim to scammers. The regulators’ research shows that one-third (32%) of pension holders in this age group would not know how to check the legitimacy of a pensions adviser or provider.

The advertising campaign is designed to be hard-hitting and will contrast the devastating impact scams can have on their victims with the lavish lifestyles enjoyed by some of the scammers from the proceeds of their schemes.

The FCA and TPR suggest that the following could all be signs of a pension scam:

  • A promise of a ‘free pensions review’
  • Cold call contact via phone or another method
  • A promise of guaranteed high returns
  • Investment in specialist areas such as overseas property, woodland and energy schemes
  • High pressure sales tactics
  • Complicated arrangements involving several parties, all of whom want to deduct their fee from the pension investment

The FCA suggests consumers take four steps to ensure they don’t fall victim to pension scammers:

  • Step 1 – reject any offer where someone contacts them out of the blue about a pension opportunity
  • Step 2 – check that any company they deal with is authorised on the Financial Services Register, is registered with Companies House, is not listed as a clone firm on the FCA website and is not on the Warning List on the FCA website
  • Step 3 – take time to consider any pension offer, and don’t be rushed into saying Yes
  • Step 4 – before making any investment, seek impartial professional advice or guidance, i.e. not advice from the company that made contact about the pension opportunity

Mark Steward, Executive Director of Enforcement and Market Oversight, FCA, said:

“The size of individual pension pots makes pensions savings an attractive target for fraudsters. That’s why we’re urging anyone who is thinking about transferring their pension to check who they are dealing with and only use firms authorised by the FCA. Pension scams can cause victims significant harm – both financially and mentally. If you are ever in doubt about a pension offer, visit the ScamSmart website.”

Nicola Parish, Executive Director, TPR, said:

“£91,000 is a huge amount of money for someone approaching their retirement to suddenly have ripped from their savings. If someone cold calls you about your pension, it’s probably an attempt to steal your savings. Our message is clear – hang up and report it.”

Guy Opperman MP, Minister for Pensions and Financial Inclusion, said:

“Pension scams are devastating for hardworking people and can rob them of the retirement they planned. I would urge savers to always exercise caution and seek independent guidance or advice before making important financial decisions.”

Dimitrios Tsivrikos, consumer and business psychologist, said:

“Scammers are intelligent, ambitious and deceiving. They mimic the sales patter used by salesmen, building trust, a rapport and a relationship to infiltrate our psyches and influence our behaviour. That’s why I want everyone to remember that if it sounds too good to be true, then it probably is. So, put the phone down to unsolicited calls regarding your pension and stop a scammer from stealing your retirement.”

The information shown in this article was correct at the time of publication. Articles are not routinely reviewed and as such are not updated. Please be aware the facts, circumstances or legal position may change after publication of the article