Being aware to Pension Scams

Find out about potential scams, how they could affect you, and how to protect yourself.

Unfortunately, one of the negative consequences of pension freedoms has been a sharp rise in fraudulent schemes seeking to part investors from their pension funds. Many of these fraudsters can be convincing and persistent; with many individuals seeing a lifetime of pension saving disappear.

In the first instance you should always talk to your financial adviser. If you don’t have an adviser, you can find one in your area by visiting unbiased.co.uk and reading reviews of financial advisers by visiting vouchedfor.co.uk.

Please note the Embark Group and its subsidiaries are not responsible for the content of external websites and bear in mind, you might be charged for any financial advice you receive.

There are also some useful tools available to help you safeguard against fraud and scammers and we feel as a good starting point you should ask yourself five simple questions.

1. Have you done your research?

An offer that’s too good to be true often means that it is. Carry out research on the named individual/company before signing over…An offer of investments guaranteeing returns or incredibly high returns are usually warning signs

2. Have you taken your time?

As one of your most valuable assets, decisions regarding your pension investments should be extensively thought through. Take your time, don’t rush into making any decisions and read through all documentation. If unsure about the financials, then always seek advice from a regulated financial adviser

3. What’s in the small print?

If you withdraw money from your pension to take advantage of an investment opportunity, you could face additional tax charges. Make sure you understand the terms and conditions of the pension plan you’re invested in and any future investments you make.

4. Do you know your rights?

Ensure you don’t get stung by tax charges or loss of money by accessing your pension early – make sure you understand the terms and conditions of the plan you have invested in. You can’t access your pension savings before you’re 55, unless you are ill and unable to work, or you have a protected early retirement age

5. How does it feel to you?

Trust your instincts! Cold calls, emails and texts are not only more than likely to be illegitimate; they may well be illegal. The offer of free a free review or service may be tempting, but it could be part of a scam – along with high commission rates. If it sounds too good to be true, then it probably is.

How do I know if I’ve been a potential victim?

The following list may indicate fraudulent activity:

• You have received an offer out of the blue, i.e. you have had no previous contact with this person or organisation
• You have clicked on an advert on social media or a paid for / sponsored advert online
• You have received or responded to an email from a sender you do not already know
• You have been made to feel pressured or hurried into making a decision to transfer
• You have received an unsolicited cold call
• You have given personal details out over email or in a phone call without first verifying who the caller was or who sent the email.

If you feel that you have carried out ANY of the above points then please inform the police via Action Fraud (actionfraud.police.uk/).

Useful links

Falling foul of a scam could mean you lose some or all of your money. See pension-scams.com or fca.org.uk/scamsmart for more information. Additionally, visit Take Five takefive-stopfraud.org.uk/; a national campaign offering straight-forward, impartial advice that helps prevent email, phone-based and online fraud

Pension Wise

You are also entitled to free, impartial advice on your options from Pension Wise, a government service from MoneyHelper. Pension Wise provides assistance and details of the options available to you in respect of your pension savings. You can access this online at https://www.moneyhelper.org.uk/en/pensions-and-retirement/pension-wise, over the telephone on 0800 138 3944, or face to face through the Citizens Advice Bureau.

Pension Wise should not be seen as a substitute for full regulated advice.