Stay one step ahead of the fraudsters with our series of articles giving you the lowdown on the scams they use to trick people out of their hard-earned cash – and how to avoid being taken in by them.
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This week, we look at what the government is doing to crack down on pension fraudsters.
How does it work?
Pensions savers now have more choice than ever before when it comes to what to invest in.
Unfortunately, however, fraudsters have used this as an opportunity to set up scam schemes designed to trick people out of their hard-earned savings.
Close to £5 million was stolen by pension scammers in the first five months of this year alone.
Many of the scams involve criminals cold calling savers to convince them to take money out of their existing pension funds by promising much higher investment returns. Others start with text messages or emails detailing similar opportunities.
Now, though, the government has announced plans to prevent scams of this kind by banning cold calls, emails and texts “in relation to pensions”.
It is also planning to tighten up tax rules to “stop scammers opening fraudulent pension schemes”.
How can I avoid being caught out?
Once this new government ban comes into force, you can be sure that any unsolicited calls, emails or texts you receive about pensions are breaking the law, and should be ignored.
To further protect yourself, the Pensions Regulator also recommends checking that any company you are considering investing with is authorised by the Financial Conduct Authority before transferring cash to it.
I’ve been defrauded. What should I do?
If you think you have fallen victim to pension fraud, call The Pensions Advisory Service on 0300 123 1047.
You can also report the scam to Action Fraud on 0300 123 2040.