/ Money

Has someone tried to fool you with a pension scam?

Better Pensions

Have you received potentially fraudulent sales calls, emails and junk mail about your pension? We’ve found that one in three people over 55 has – would you ever trust a cold caller?

It’s shocking that so many people have already been targeted by cold callers about their pension. After all, it’s just six weeks after reforms were introduced to give you much more control over your pension savings.

But how confident are you at being able to spot a scam? Many of those we spoke to admitted they weren’t sure they could spot a genuine investment and four in 10 worried they could be scammed.

How will the scammers try to trick you?

So how are these scammers going to try and fool you? Most commonly we found they offered investment opportunities or a free pension review, or said they could unlock your pension or would let you get your pension pot early.

The most common approach was by telephone – so be on your guard if you get a cold call. Contact by email and post were also high up the list.

Two in five people were contacted in the months before the reforms began (1 January to April 6 this year) – that’s double the number who said they were contacted in the whole of 2014.

How do I avoid the pension scammers?

A fifth of all over-55s had been contacted directly by someone offering an investment opportunity, but only half of non-retired over-55s felt confident in identifying a legitimate pension investment.

Here are some of the sales tactics that should set alarm bells ringing:

  • You’re approached out of the blue over the phone, via text or in person door-to-door
  • You’re asked to transfer money overseas
  • You’re promised you can access your pension before you’re 55
  • No copies of documentation have been provided
  • You’re encouraged to speed up transfer of your money to the new scheme
  • A salesmen uses phrases such as ‘one-off investment opportunities’, ‘free pension review’, ‘legal loopholes’, ‘cash bonus’, or ‘government endorsement’

We want the Government and regulators to do more to warn people about these types of tricks and do all they can to stamp out the sharks behind them.

Has someone ever tried to sell you a dodgy pension product? Do you feel confident that you’d know how to invest your pension pot and how to spot a pension scam?

Comments

I have never bought anything as a result of a cold call or from a doorstep visit. I now make this very clear to callers. If there is a call that appears to come from a company I already use, I find out what it is about and say I will call back. When I do call, I look up the number online rather than using a number I have been given.

I am equally suspicious of email. I may have missed some good opportunities but have protected myself against scams.

wev says:
16 May 2015

Adam, can you change what you’ve written to include advice on where to go if you’re approached by a scammer, especially if they have your personal information? Go to Action Fraud, Trading Standards, Companies Investigation Branch, the police, or something else?

“A fifth of all over-55s had been contacted directly by someone offering an investment opportunity,”

It does sound dramatic but I cannot see from the magazine or here; over what period are these figures true? In the last six months, in the last decade, or since they turned 55 which could be one week or 40 years.

Can we have a link to the survey on which these claims are based? I would not like to think that “facts ” are bandied about without the underlying figures being available. If people were more accustomed when reading the media to seeing the basis of claims it would lead to a much savvier nation and help defeat those that manipulate data in misleading ways.

Adam – Can you supply a link to the research?

I see from the magazine article that it was an online survey of 2000 members of the UK public. They may also have been Which? Connect members as it was a Which? survey. I would hesitate to assume that these were all people aged over 55 as it may have been a sub-set of the 2000 approached.

The phrase ” We’ve found that a third of over-55’s in the UK have been contacted directly by someone looking to sell them a potentially dodgy pension product.” would seem to be untrue – you might say your survey suggests/ reveals a third of the surveyed have been contacted

I hope you understand that when you warn people to be careful that this state of mind should apply to anything you read or listen to , and claims checked against reality.

I used to be in the finance industry and I can tell you that some areas of the UK will be contacted far more frequently than others. I am therefore pretty sure that Which? Connect respondents will be more attractive to salesmen than the average retired household in the UK.

No doubt Which? ‘s own analysis of its members would also reveal a match to certain socio-economic areas more than others.

Thanks for the extra detail. Adam

Its funny but I assumed the scam was actually getting people to change policies or the obtaining of money but judging from the linked article in fact stealing people’s identities seems much easier and simpler.

On the question of pensions:

Overall I think the new government policy is ill thought out and the places to get advised very poor. Looking at what is happening in Australia where they are a decade ahead in releasing funds at 55 following the setting-up of a Superannuation Guarantee in 1992.

The observation seems to be that the knowledge you can access a lump sum later in life seems to have lead to increasing debt since 1992 also.