What Is Retirement Fraud, and How Can I Prevent It?
Fraud is a rising problem in the UK, and pension scams can sometimes be hard to spot. Scammers can be personable and financially knowledgeable, and even have credible websites – making them harder to spot.
How Do Pension Scams Work?
Scammers will contact people via phone, email or text, or may advertise online in small ads. They design attractive offers to entice users, usually with high interest rates or unachievable returns on investment. This money that is stolen may then be:
- Invested in high-risk investments overseas
- Invested in conventional products but with complex structures
- Simply stolen and the scammer disappears
How Do I Spot A Scammer?
One way to spot a scammer is by looking out for warning signs. Scam offers sometimes include:
- Free pension reviews
- Higher rates of returns
- Unusual investments
- Long-term investments
- Complicated structures (where it isn’t made clear where your money will end up)
- Help to release cash from your pension is under 55
Scammers will often use high pressure sales tactics to make you feel pressured into what they are offering. This can include ‘time limited offers’ that force you to sign up.
How Can I Protect Myself From Pension Scammers?
There are some easy ways to protect yourself from being targeted by pension scammers, these include:
- Reject unexpected offers – If you’re contacted out of the blue with a pension opportunity then the likelihood of it being a scam is high. Cold calls are also unlikely to come from reputable sources, so always hang up if you find yourself in this situation.
- Check the Company – the Financial Services Register is created to make sure that anyone that offers financial services and advice is registered to do so. However, be vigilant as many scammers will pretend to be an authorised firm – so always check the contact details on the Register, rather than using the details the firm gives you.
- Don’t feel pressured – If you get offered a deal or service, take your time to do the necessary research needed on the company. Don’t feel rushed into making a decision – if they are legitimate they will wait for your decision without pressuring you.
To protect yourself from scammers, you can also get impartial advice, from places such as the Pensions Advisory Service. However, if you have been a victim of fraud, contact our experts today to see how we can help you.