Over 5m savers at risk from pension scams
More than 5m pension savers across the UK are at risk from common scamming tactics, underlining current concerns over fraudsters targeting people’s retirement cash pots.
A new report from two of Britain’s top financial bodies has found that 42 per cent of pension savers, which equates to over 5m people, could be in danger of losing out from criminal tricks such as cold calls and time-limited offers.
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According to the Financial Conduct Authority (FCA) and The Pensions Regulator (TPR), which are joining forces to warn the public against retirement fraud, the chance of being drawn into one or more scams soared to 60 per cent among those who said they were actively looking for ways to boost their retirement income.
Nearly a quarter of the 2,000 adults surveyed also said they would be likely to pursue offers of high returns in exotic investments such as overseas property, biofuels and storage units.
Victims of pension fraud lost an average £82,000 last year, prompting calls for a greater clampdown on new fraud techniques.
Tom Selby, senior analyst at AJ Bell, said: “While huge strides have been made in tackling pension and investment fraud recently, particularly when it comes to raising awareness among consumers, this research shows a worryingly large number of people are at risk of falling victim to common tactics used by fraudsters.”
He added: “Scammers’ tactics are evolving all the time and increasingly we see complex schemes promoted online through social media. This virtual Wild West is a natural home for fraudsters, with Governments around the world struggling to create meaningful protections for consumers.”
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Financial regulators have used this morning’s findings to call on consumers to reject unexpected pension offers, whether made online, on social media or over the phone.
Pension cold calls, free pension reviews, claims of guaranteed high returns, exotic investments, time-limited offers and early access to cash before the age of 55 are all being used as tactics to tempt savers into risking their retirement income, according to the report.