Regulators team up to warn over scourge of pension scams.
CITY regulators are launching a new campaign to tackle pension scams as alarming figures show that victims of fraud lost an average of PS91,000 each in 2017.
The Financial Conduct Authority (FCA) and The Pensions Regulator (TPR) have joined forces to urge the public to "be on their guard" when receiving unexpected offers about their pension and to check who they are dealing with.
A new ScamSmart advertising campaign will target pension holders aged 45-65, the group most at risk of pension scams, the duo said.
A total of 253 victims reported to Action Fraud that they had lost more than PS23 million to pension scammers in 2017, equating to an average loss of PS91,000 per victim.
However, it is thought that only a minority of pension scams are ever reported.
It comes as "highly sophisticated" scammers continue to lure people into transferring their pensions into fraudulent schemes, the FCA warned.
One of the most common tactics is to offer a "free pension review", with cold calling the most common method used to initiate pension fraud.
Other scam tactics include unexpected contact via phone, post or email, promises of guaranteed high returns and downplaying the risks and offering unusual or overseas investments that are not regulated by the FCA.
The latter can include overseas hotels, forestry and green energy schemes.
Other methods used by fraudsters include putting people under pressure to make a quick decision, for example with timelimited offers, and sending a courier round with paperwork to sign.
Some also claim to be able to unlock money from an individual's pension, which is normally only possible from age 55.
Mark Steward, executive director of enforcement and market oversight at the 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."
Research conducted by the regulators shows that one in eight 45 to 65-year-olds (12%) would trust an offer of a "free pension review" from someone claiming to be a pension adviser.
Worryingly, almost a third (32%) of pension holders aged 45 to 65 would not know how to check whether they are speaking with a legitimate pensions adviser or provider.
The FCA and TPR recommend four steps that people should carry out to protect themselves from pension scams: | reject unexpected pension offers, whether made online, on social media or over the phone; | check who you are dealing with before changing your pension arrangements; | do not be rushed or pressured into making any decision about your pension; and | consider getting impartial information and advice.
The advertising campaign will highlight the contrast between the impact on the victims of pension scams and the lifestyles enjoyed at their expense by the criminals.
Using TV, radio and social media adverts, it urges anyone who is contacted about their pension to visit ScamSmart before transferring funds.
|Printer friendly Cite/link Email Feedback|
|Publication:||Western Mail (Cardiff, Wales)|
|Date:||Aug 15, 2018|
|Previous Article:||Lowest interest rates don't mean cheapest home loans.|
|Next Article:||Mothers 'more likely to be trapped in lower paid jobs'.|