PENSION SCAMS
Can you afford to lose your retirement savings?
An increase in pensions scams has been seen through the pandemic as more people are concerned about their finances and may be seeking to access funds or move savings to a higher investment-return environment.
Scams come in many different forms and can result in a transfer of funds to unsuitable and unregulated arrangements, giving rise to unexpected tax charges, or even the entire fund disappearing. Over £30 million lost to pension scammers was reported to Action Fraud between 2017 and August 2020. Industry estimates of the scale of the problem are much higher, with the Pension Scams Industry Group, a voluntary body set up to tackle pension scams, estimating that £10 billion has been lost by 40,000 people to pension scams since 2015.
Tell-tale signs include direct contact out of the blue from someone you don’t know, including by telephone, email or on social media. Scammers will make false claims to gain your trust and design offers to persuade you to transfer or release funds from your pension to them. These can often be time-pressured with short deadlines to sign documentation.
If you are considering a transfer of your pension entitlement from the Scheme, you can request a transfer value from the scheme administrator, XPS. You may request one free transfer value in every 12-month period. This transfer value will be guaranteed for three months.
Please note that if your benefits are valued at more than £30,000, the law requires you to take independent financial advice from an adviser who is authorised by the Financial Conduct Authority (FCA). You can check that your adviser is registered with the FCA to provide advice about defined benefit pension transfers at:
www.fca.org.uk/firms/financial-services-register
More information on how to tell a scam and help if you think you have been scammed can be found at:
www.pensionwise.gov.uk/en/scams
The old adage still stands that if an offer sounds too good to be true, it probably is.