Avoiding pension scams

You may think that it could never happen to you, but anyone can become a victim of a pension scam, no matter how well informed you think you are.

Pension scammers often promise low risk and high returns, but the aim is always to get their hands on your hard-earned savings. Millions in pension savings are lost each year to pension scams and all sizes of pension pots are targeted.

Pension scams are becoming increasingly hard to spot because fraudsters often have credible websites and make false claims, such as being government approved, in order to gain your trust. It’s really important if you are considering transferring or releasing your pension, that you know the signs to look for to stop a scam in its tracks.

The Pension Scams Action Group offers the following tips through their pension scams leaflet to help you avoid falling victim to a pension scam. The Group is a multi-agency taskforce of law enforcement, government and industry working together to tackle pension scams.

If you’re contacted out of the blue about a pension opportunity, chances are it’s a scam. Legitimate pension providers are highly unlikely to contact you unexpectedly about your pension.

Pension cold calling is illegal, and you should be very wary. An offer of a free pension review from a firm you’ve not dealt with before is probably a scam.

Check the Financial Conduct Authority (FCA's) register to make sure anyone offering you advice is allowed to do so. You can also check the FCA warning list to see if the firm is one the FCA are concerned about.

A firm pretending to be real is known as a 'clone firm' and may have a fake website that looks exactly like the real deal. Double check their contact details against the register to see if they match.

Make sure the firm you use is FCA-authorised, otherwise you will not be protected by the Financial Ombudsman Service or Financial Services Compensation Scheme, if things go wrong.

Telephone the FCA: 0800 111 67 68.

Being pressured to make a quick decision or you'll 'miss out', is often a warning sign.

Take your time to make all the checks you need and if it sounds too good to be true, it probably is.

You should consider seeking financial advice before changing your pension arrangements.

MoneyHelper provides free and impartial guidance over the phone or through webchat. Visit www.moneyhelper.org.uk or phone 0800 011 3797.

If you can, it’s also a good idea to speak to a financial adviser. Since large amounts of money are often at stake, a financial adviser will be able to help you make the right decision for you. Do make sure that any adviser you choose is regulated by the FCA.

Further guidance on how to avoid a scam is available from:

• The Financial Conduct Authority
• MoneyHelper
• Stop! Think Fraud
• Age UK

Buckinghamshire Pension Fund has taken The Pension Regulator’s Pledge to combat pension scams

We have made a promise that we will:

• regularly warn our members about pension scams
• encourage our members to get impartial advice from MoneyHelper
• educate ourselves so that we can spot the warning signs of a scam
• carry out appropriate due diligence checks on pension transfers
• clearly warn members who insist on a high-risk transfer being paid
• report concerns about a scam to the appropriate authority

Additionally, when we receive a request to transfer, we are required by law to perform due diligence to check for the possible presence of a pension scam. If we have significant concerns, we can prevent the transfer proceeding.

Find out more about transferring to another scheme.