Avoid Pension Scams with FCA Advice

The Financial Conduct Authority (FCA) warn that scanners are targeting people’s pensions and offer advice on how to stay safe.

Scammers usually contact people out of the blue via phone, email or text, or even advertise online. Or they may be introduced to you by a friend or family member who is also unknowingly being scammed.

They may claim they are authorised by the FCA or that they don’t have to be FCA authorised because they aren’t providing the advice themselves. Some even claim to be acting on the behalf of the FCA or MoneyHelper’s Pension Wise.

The Warning Signs of Scams

  • free pension reviews
  • higher returns – guarantees they can get you better returns on your pension savings
  • help to release cash from your pension even though you’re under 55 (an offer to release funds before age 55 is highly likely to be a scam)
  • high-pressure sales tactics – the scammers may try to pressure you with ‘time-limited offers’ or even send a courier to your door to wait while you sign documents
  • unusual investments – which tend to be unregulated and high risk, and may be difficult to sell if you need access to your money
  • arrangements where there are several parties involved (some of which may be based overseas) all taking a fee, which means the total amount deducted from your pension is significant
  • long-term pension investments – which mean it could be several years before you realise something is wrong

How to protect yourself from pension scams

1. – Reject unexpected offers

If you get a cold call about your pension, the safest thing to do is to hang up – it’s illegal and probably a scam. Report pension cold calls to the Information Commissioner’s Office (ICO).

If you get unsolicited offers via email or text, you should simply ignore them.

Don’t be talked into something by someone you know, even a friend or family member. They could be getting scammed. Check everything yourself.

2. Check who you’re dealing with

Check our Financial Services Register to make sure that anyone offering you advice or other financial services is FCA authorised, and that they are permitted to provide you with those services.

If you need any help checking, call the Consumer Helpline on 0800 111 6768.

Check the FS Register

If you use an unauthorised firm, you won’t have access to the Financial Ombudsman Service or Financial Services Compensation Scheme (FSCS) so you’re unlikely to get your money back if things go wrong.

Check the directors’ names and whether the firm is registered with Companies House. Search the company name and the directors’ names online to see if others have posted any concerns.

You can also check the FCA Warning List to find out if there are any risks of a potential pension or investment opportunity. This will allow you to see if the firm is known to be operating without our authorisation.

3. Don’t be rushed or pressured

Take your time to make all the checks you need – even if this means turning down an ‘amazing deal’. Be wary of promised returns that sound too good to be true and don’t be rushed or pressured into making a decision.

4. Get impartial information or advice

You should seriously consider seeking financial guidance or advice before changing your pension arrangements.

  • MoneyHelper provides free independent and impartial information and guidance.
  • If you’re over 50 and have a defined contribution pension, MoneyHelper’s Pension Wise offers pre-booked appointments to talk through your retirement options.
  • You can also use a financial adviser to help you make the best decision for your own personal circumstances. If you do opt for an adviser, make sure they are regulated by the FCA and never take investment advice from the company that contacted you, as this may be part of the scam.

If you have any experiences with these scams do let me know, by email.

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