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Pension scams

Pension scammers promise to convert pension funds into cash before retirement, or in some cases they may suggest people can take more than 25% of their pension pot as cash. Pension fraudsters promise to convert pension benefits into cash before age 55.

Criminals are believed to be fraudulently exploiting the pension liberation process in a number of ways. These include failing to advise members of the tax implications of receiving cash from their pension; failing to advise members of the full extent of fees to be paid in relation to any onward investment; falsely representing anticipated levels of returns when  investments are either non – existent or incapable of providing such a return.

The scammers have a variety of tricks to catch you out. They may: 

  • claim that you can access your pension pot before age 55 
  • approach you out of the blue over the phone, via text message or in person door-to-door 
  • entice you with upfront cash 
  • offer a free ‘pension review’ or try to lure you in with so-called ‘one-off’ investment opportunities.

Check the facts before you make an irreversible decision. A lifetime’s savings can be lost in a moment.

The Pensions Regulator’s five steps to avoid becoming a victim of a pension scam:

  • Cold called about your pension - just hang up!
  • Check the credentials of the company and any advisers – who should be registered with the Financial Conduct Authority.
  • Ask for a statement showing how your pension will be paid at retirement, and question who will look after your money until then.
  • Speak to an adviser that is not associated with the deal you’ve been offered, for unbiased advice.
  • Never be rushed into agreeing to a pension transfer.

For more information about pension scams visit The Pensions Regulator website. 

Before you sign anything, call The Pensions Advisory Service on 0300 123 1047

The HM Revenue & Customs website highlights the tax consequences of pension liberation to individuals

How to report it

If Fraud has been committed report it to Action Fraud. For more advice and to raise any concerns, contact the Office of the Public Guardian.

Source - Action Fraud

Date Published: Nov 13, 2019

Types of fraud

A-Z of fraud

To help understand which fraud you've been affected by, we've categorised them into an alphabetical list.

What is fraud and cyber crime?

Fraud is when trickery is used to gain a dishonest advantage, which is often financial, over another person.

Advance fee fraud

Advance fee fraud is when fraudsters target victims to make advance or upfront payments for goods, services and/or financial gains that do not materialise.

Corporate fraud

Corporate fraud can be any fraud committed against a business.

Individual fraud

Individual fraud could be any fraud that targets a person directly. Individual frauds can differ from frauds affecting businesses and other organisations.

Online fraud

Some fraudsters rely on the internet to commit their crimes. Learn about some different types of internet frauds that and how to protect yourself and get safe online.

Identity fraud and identity theft

Identity theft is when your personal details are stolen and identity fraud is when those details are used to commit fraud.
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