Those approaching retirement are being urged to be aware of a rise in pension scams, as criminals seek new ways to defraud pensioners.
Savers have been urged to be aware of a rise in pension scams, as criminals seek new ways to defraud pensioners. AΒ report produced by Citizens Advice looked at 150 cases where pensioners had fallen victim to fraudsters. The report identified common types of scams which include:
- encouraging pensioners to move their savings into a βnewβ pension
- fake investment opportunities and
- offering apparently βfree adviceβ and support which actually costs money.
In some cases pensioners are charged a fee for a service that isnβt required, while others are encouraged to part with personal information and bank details, either by email or phone.
Gillian Guy, Chief Executive of Citizens Advice said:
‘Scammers see pensioners as a prime targetβ¦.βThere are many people looking to benefit from the new pension rules, including scammers. Fraudsters can ruin peopleβs retirement plans by taking a portion or all of a victimβs pension pots.β
The Pensions Regulator (TPR) has recently launched a campaign to alert people to the danger posed by fraudsters.
From 6 April 2015 individuals have more flexibility as to how they use their pension pot, including the option to choose to take all their savings as a cash lump sum. TPR has warned that scammers are exploiting this change by enticing those about to retire with promises of βone-off investmentsβΒ or βpension loansβ or βupfront cashβ, most of which are bogus.
Individuals who believe they are being targeted by a pension scam should contact the Pensions Advisory Service on 0300 123 1047. The Financial Conduct Authorityβs website also has a list of known scams. Visit scamsmart.fca.org.uk.