A Bumper Crop of Pension Scams in 2021
Have you been offered ‘a free pension review’ in the past few months? It may have come via text message, Facebook, or online advertising, from a company claiming to be FCA authorised. Anyone accepting their offer will be offered incentives – guaranteed returns, or a cash sum – to move their pension into a high risk scheme. And because it’s a long-term investment, it can be years before the fact it’s a pension scam comes to light.
2021 has produced a bumper crop of pension scams, many of which took advantage of lockdown periods when people were spending more time in front of their screens. Action Fraud reports that a total of £2,241,774 has been handed over to pension scammers since the beginning of 2021. The average individual loss totalling £50,949, which is more than double last year’s average.
FCA Finds Savers Are More Vulnerable to Online Threats
Research undertaken by the Financial Conduct Authority (FCA) has found that pension savers are 9 times more likely to accept pension advice from someone online, than from a someone ringing the doorbell with a similar offer. There was also a worrying lack of awareness around online scams. 68% of those asked believed they could spot a scam, but only 28% saw any danger in accepting the offer of a pension review.
What are the Scams to Watch Out For?
The golden rule when it comes to scams is to mistrust anything that come ‘out of the blue’ or sounds ‘too good to be true’. Scammers know their victims’ ‘pain points’ and will try to provide amazing solutions for them. Take your time before agreeing to pass your information onto a 3rd party, and always check them against the FCA warning list. The current crop of scams include:
- Free pension reviews
- Early pension release if you’re under 55
- The promise of higher returns on your pension savings
- Unusual investments in things like biofuel, care homes, forestry
- Complicated investments involving a number of different parties
- Time-limited offers with high- pressure sales techniques
The FCA’s advice is to ‘flip the context’ for any offer you receive by imagining it’s coming from a stranger at the door, or someone who’s approached you whilst shopping or in the pub. If you wouldn’t trust it in those circumstances, don’t trust it online. If you think you’ve been scammed recently, you can contact the FCA on 0800 111 6768, or message them online for advice and information.
Looking for Pension Peace of Mind?
Harpur Wealth Management offers FCA regulated pension advice that you can trust, because we take time to build a trust-based relationship. Our pension planning advisors take time to get to know you face-to-face, or online if your prefer. We find out what your retirement plans are, and work out how much you will need to fulfil them. Then we’ll work with you to create a pension plan for achieving the retirement you desire.