As the coronavirus (COVID-19) pandemic continues, the related economic uncertainty means that criminals will try to take advantage by making attractive-sounding promises when people are feeling vulnerable and uncertain about the future.
The Pensions Regulator (tPR), Financial Conduct Authority (FCA) and Insolvency Service have all issued warnings in recent weeks following an increase in scams, and Action Fraud has also reported an increasing number of scams with a link to COVID-19.
On average scam victims lose £91,000 from their pension. So, what should you be looking out for? How can you spot a scam?
Step 1 - Reject unexpected offers
If you’re contacted by a company you’ve never dealt with before about a pension opportunity, it could be a scam. Pension cold calling is illegal, so please be very wary, particularly of ‘free’ pension reviews, ways to take your pension early, and guaranteed investment returns. The RMSPS won’t ever contact you with deals, offers, or to encourage you to transfer your pension elsewhere.
Step 2 - Check who you’re dealing with
Search ScamSmart and check the FCA’s register to make sure anyone offering you advice is authorised. If they are authorised, you can check they are allowed to give pension advice by calling the FCA Consumer Helpline on 0800 111 6768.
If you don’t use an FCA-authorised firm, you won’t have access to any compensation schemes if something goes wrong.
Step 3 - Don’t be rushed or pressured
Take your time to make all the checks you need and don’t be forced to make a decision – even if this means turning down an ‘amazing deal’. Talk it over with a family member or a friend you trust, if you’re feeling unsure and want to consider your decision carefully.
Step 4 - Get impartial information or advice
Take financial advice before doing anything with your RMSPS pension, and if you want to transfer it, you will have to show you have taken financial advice. You can find an authorised adviser in your local area by going to www.fca.org.uk/consumers/finding-adviser
You can also use the Pensions Advisory Service for free independent and impartial information and guidance.
If you think you’ve been contacted by a scammer or criminal enterprise, report it.
You can report an unauthorised firm or scam to the FCA using the online reporting form or you can call them on 0800 111 6768. If you are worried that you’ve already paid out money to a scammer, you should report it to Action Fraud on 0300 123 2040 or at actionfraud.police.uk straight away.
You can find out more about scams and how to avoid them on the FCA’s ScamSmart web pages: www.fca.org.uk/scamsmart or on takefive-stopfraud.org.uk