Four ways to identify a pension scam (and what to do about it)

Category: News

11 million pensioners are targeted by pension-related fraudsters every year (Source:

Since the beginning of 2018 alone, 14% of non-retired over 50s have received potential scam communication, according to Retirement Advantage.

Despite the announcement that the Government is working toward a complete ban on pension cold calling, there is little relief for those who are retirees or preparing to retire.

Will pension scams stop?

It is almost impossible to remove the potential for pension scammers to try their luck. Even when cold calling becomes illegal, you will still need to be wary of scammers approaching you by other means, including:

  • Visiting your home
  • Email
  • Letter
  • Text message

How to spot a potential scam

1. Unsolicited contact

If you have not given your information to the person contacting you, they could be attempting to scam you. Similarly, if you receive communication from someone claiming to represent an official organisation, such as Pension Wise or even your financial adviser, we urge you to be vigilant. Put simply, never take financial advice from someone contacting you via cold call or unsolicited approaches, full stop.

2. Unrealistic claims

If you receive anything promising to save you money on tax, release your pension capital early (before the age of 55) or low-risk high-return investments, it’s time to report it. All these claims are simply stories to persuade you to hand over your money.

3. Avoiding questions

If you notice that the person you are talking to tends to avoid questions or give vague answers, or that the message you have received does not contain much detail, the chances are that the person or people contacting you cannot back up their claims. Any official communication will have easily traceable contact details and will welcome any questions you ask to verify their authenticity.

4. Applying pressure

Making it sound like you need to act immediately, without giving you time to think about what you are committing to (or to verify their claims) is a common tactic used by scammers.

If you feel pressured into anything, it is better to say that you need time to think and investigate what they have said more deeply. A legitimate company will have no problem leaving you to do independent research and will probably recommend that you seek independent financial advice before making any decisions.

What to do if you are worried about a scam

Pension scammers are not new, and the attempts to access your money are unlikely to stop just because they can no longer use phone calls to their advantage. If you receive any suspicious communication, you can try to verify the sender’s identity and authenticity by:

  • Checking the Financial Services Register: All financial services companies are regulated by the Financial Services Authority (FCA). Those who are can be found on the register, which contains both companies and individuals operating in the profession. If you cannot find any evidence that the company you have been contacted by is above board, you should be wary.

If the company contacting you does appear on the register, you can double check that it was them who contacted you. This is advisable as there has been an increase in the amount of ‘clone firm’ scams recently; these are run by scammers using a real company’s information to trick customers into handing over money.

  • Putting the company details into a search engine, such as Google: Thanks to the growing popularity of online forums, many people will post public warnings when they have been contacted by, or worse fallen victim to, a scammer.

Often, a quick search of the company name or contact information can give you an insight into the legitimacy of a company.

  • Remember the two golden rules: Never act on a cold call and, if something sounds too good to be true, it probably is!

If you are in doubt, or need to report a potential scam, contact Action Fraud by clicking here.

In addition, feel free to contact your financial adviser or planner, who will be able to verify the source of the contact and advise you as to your next steps and options.



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