“This research shows that consumers are highly susceptible to some of the underhand tactics used by scammers. Nearly a quarter of the savers surveyed by the industry regulators were tempted by ‘exotic’ investments in things like forestry and biofuels, which is a staggeringly high number when you consider people are referring to putting their life savings in an investment they know little or nothing about.
“Spotting a pension scam can be tricky and it is absolutely critical for savers to have their guard up when approached with an offer to move their pension to a new scheme, transfer into unusual assets promising outlandish returns, or take advantage of a scheme offering early access.
“Thankfully, there are some important steps to take to help protect yourself against the risk of pension scams. Firstly if a scheme sounds too good to be true it almost certainly is. Any scheme promising bumper returns is to be treated with caution. Secondly, be sure to check the FCA’s ScamSmart website to ensure you’re not moving to a scheme which the regulator has already identified as a possible scam. But don’t assume that just because it isn’t listed that the scheme is legitimate. Instead, always speak to a qualified financial adviser or the Pensions Advisory Service about any major change to your pension plans. They will help guide you and, most importantly, will be able to point out when something looks too good to be true. Finally, if you are contacted out of the blue then be very cautious. Cold calling is often used by scammers to lure in vulnerable savers. Indeed the Government have banned companies making unsolicited calls (cold calling) to people about their pensions. If you do get a call you’re unsure about, the safest thing to do is put the phone down.
“Today’s figures show that the average pension fraud costs the victim an eye-watering £82,000. Similarly, under scrutiny from the government’s Work and Pensions Committee, The Pensions Regulator recently revealed that it has seven active criminal investigations currently under way in cases where it believes investors have lost £55m from fraudulent transactions. Pensions scams are big business so it is absolutely critical to protect your savings by taking professional financial advice before making any major decisions that could damage your finances.”