Pension scams

Pension and investments fraud

How do the scams work?

Pension and investment scams

Pension and investment scams are often difficult to spot as they're designed to look genuine.

  • We're aware that people are being contacted unexpectedly for a ‘free pension review’. It could be a phone call, an email, text message or an offer in an online advert.
  • People who operate investment scams use sophisticated techniques to build trust and convince even the most experienced investors out of their savings. 
  • While these offers appear to be legitimate, most of the firms and individuals involved in these offers are not authorised or regulated by the Financial Conduct Authority.

How can I protect myself and my investments?

  • The Pensions Advisory Service (an independent organisation supported by the Department for Work and Pensions) provided the industry with a tool to allow people to self-serve and to allow people too embarrassed to raise their questions and concerns with their pension provider and to go online and get some guidance in relation to next steps.

The tool can be found on the Pensions Advisory Service website.

  • The Pensions Regulator also launched a campaign which provides individuals with information about how they can protect themselves from scammers.
  • The Financial Conduct Authority is the conduct regulator for financial services firms and financial markets in the UK. If you need investment advice, then you should go to an adviser that is authorised and registered by the Financial Conduct Authority.
  • If you need help in finding a regulated adviser then please visit www.unbiased.co.uk where you will be able to search for an authorised and regulated adviser near you.
  • Action Fraud is the UK’s national reporting centre for fraud and cyber crime where you should report fraud if you have been scammed, defrauded or experienced cyber crime.
  • The Money Advice Service is an organisation established with cross Government party support that provides free and impartial advice on money and financial decisions to people in the United Kingdom.

If you have any concerns in respect of any unsolicited contact about your LV= pension, please email us at [email protected]

How could you be targeted

Companies sometimes target savers claiming they can help them take their pension cash early. This may be through websites, mass texting or cold calls. Be very cautious about giving out information in response to a text or cold call. Make sure you know who you're dealing with.

Pension liberation fraud

Pension liberation also known as 'pension loans' and 'pension scams', is the transfer of pension savings to an arrangement allowing you access to your funds before the age of 55. In rare cases, such as terminal illness, it's possible to access funds before age 55 from a pension scheme. But most of the time, promises of early cash are false and likely to result in serious tax penalties.

Pension Wise never cold calls

If someone cold calls you saying they are calling from Pension Wise, you can be assured that they are a fraudster, and only looking to add legitimacy to what they are trying to do - get their hands on your pension pot.

What are the risks

If the 'investment opportunity' is a scam, you stand to lose all of the money that you have invested.

If there is an actual investment, your pension pot is typically invested in unusual, high-risk investments such as overseas property, forestry, storage units, care homes, biofuels and therefore there is a significant risk that you would lose some or all of your investment.

It might also be difficult to sell any investments to get any of your money back.

In either case, it is likely that the funds you had earmarked to provide for your needs during your retirement will be significantly reduced and possibly lost completely. In addition, if things go wrong you will not be able to complain to the Financial Ombudsman Service or claim against any compensation schemes as the firms and individuals involved in these scams are not authorised and regulated by the Financial Conduct Authority.

Remember, if an investment opportunity sounds too good to be true then it usually is.

When pension liberation becomes fraud

Pension liberation can be illegal. The victims are often misled about the fees, penalties or income tax they’ll have to pay. These hidden costs can be more than half of the value of the pension plan.

Pension liberation can mean tax charges and penalties of more than half the value of a person's pension savings, and those targeted are usually not told about this.

Scamsmart

Don't let a scammer enjoy your retirement!

  • The Pension Regulator (TPR) has launched a new campaign so everyone can understand how to protect themselves from scammers.
  • Learn how to spot the signs and check who you're dealing with on the ScamSmart website to give yourself the biggest protection against fraudsters. 

4 simple steps from the FCA to protect yourself from scammers

Step 1

Reject unexpected offers

Step 2

Check who you're dealing with

Step 3

Don't be rushed or pressured

Step 4

Get impartial information or advice

Reject unexpected offers

If you’re contacted out of the blue about your pension, chances are it’s high risk or a scam. Be wary of free pension review offers. A free offer out of the blue from a company you have not dealt with before is probably a scam.

    Check who you're dealing with

    Check the Financial Services Register (www.register.fca.org.uk) to make sure that anyone offering you advice or other financial services is FCA-authorised. If you don’t use an FCA-authorised firm, you also won’t have access to the Financial Ombudsman Service or the Financial Services Compensation Scheme.

      Don't be rushed or pressured

      Take your time to make all the checks you need – even if this means turning down an ‘amazing deal’. Be wary of promised returns that sound too good to be true and don’t be rushed or pressured into making a decision.take your time and make all the checks you need to, be wary of offers that sound too good to be true!

        Get impartial information or advice

        The Pension Advisory service provides free advice or contact a FCA authorised and regulated Independent Financial Advisor, If you do opt for an adviser, be sure to use one that is regulated by the FCA and never take investment advice from the company that contacted you or an adviser they suggest, as this may be part of the scam.

          Cyber aware

          How to avoid becoming a victim of financial crime

          While financial crimes comes in many different forms, it's important to protect yourself as best you can.

          • To make sure you don't get caught out, you need to be prepared to spot the signs of fraud and cyber-crime to keep you and your money safe.
          • Being a victim of a cyber-attack has many implications, so staying secure online is essential to protecting your personal identity and finances.

          Do you suspect fraud?

          If you're worried that you may suspect fraud, and you have an LV= policy, contact us via the email address below.

          Contact our Financial Crime Investigations team: