Guide to pension scams

4 minute read

Pension freedoms mean that you've now got more choice than ever on how to take money from your pension pots, or where to invest it to help it grow.

Sadly, this also means that more people are at risk of pension scams and losing their money.

A Financial Conduct Authority (FCA) study (1) has found that retirees are at an increasing risk of being scammed by investment fraud with scammers often specifically target retired professionals who have money to spend. If you’ve received unsolicited calls about an investment opportunity, check the FCA Warning List before investing.

Over 55?

Over 1 in 4 people over 55 falling victim to investment fraud are scammed by an unauthorised firm selling unregulated products like wine, diamonds or land. (1)

1. Financial Conduct Authority, 25 May 2016. View all the findings on the ScamSmart website.

Over 65?

Over 65s with savings in excess of £10,000 are three and a half times as likely to be a victim of investment fraud. (1)

1. Financial Conduct Authority, 25 May 2016. View all the findings on the ScamSmart website.

What to do if you think you've been contacted by a fraudster

If you think you’ve been contacted by a fraudster:

  • report them to the FCA online or call their helpline on 0800 111 6768.
  • make use of the free support and guidance offered by Pension Wise by calling 0800 138 3944 to book an appointment.

If you think you've fallen victim to investment fraud:

  • report it to the national fraud and internet crime reporting agency Action Fraud UK online, or by calling 0300 123 2040.

Spotting the signs of a scam

Fraudsters are very good at appearing credible, and will often sound knowledgeable about financial issues, have credible websites and endorsements, making them hard to tell apart from the real thing. It’s important to know the signs that suggest an opportunity is likely to be high risk or a scam.

Investment fraudsters may do any of the following:

  • Apply pressure on you to invest in a time-limited offer by for example, offering you a bonus if you invest before a set date.
  • Downplay the risks to your money or use legal jargon to suggest the investment is very safe.
  • Promise tempting returns that sound too good to be true.
  • Call you repeatedly and stay on the phone a long time.
  • Say that they are only making the offer available to you, or even ask you not to tell anyone else about the opportunity.

Find out more about the FCA Warning List

  • The FCA Warning List is an online tool which gives guidance based on the type of investment you're considering and how you heard about it.
  • It shows you details of the firms the FCA know are operating without permissions. Firms are added as soon as the FCA is made aware of them.
  • The Warning List also gives guidance on steps you can take to avoid scams.
  • If a firm you're looking into isn't on the list, don't presume it is legitimate. You can check it's an authorised firm through the financial services register.
  • If a firm you're looking into is on the list, bear in mind that businesses are sometimes found to be fraudulently operating under the names of authorised firms.

Learn more about how fraudsters might target you over the phone

Who's trying to control you?