Your pension is probably one of your largest assets and the result of a lifetime’s hard work and saving. It is also the prefect target for fraudsters.
One way in which pensions can be targeted is through what is known as a “Pension Review Fraud” which is designed to persuade the victim to move money from a pension pot into an investment which the victim is told offers much higher rates of return
How does a Pension Review Fraud work?
Imagine the scenario, you are sitting at home and receive a cold call from somebody offering you a free pension review. They either claim to be FCA authorised or they say that they do not need to be FCA authorised as they are not giving you any advice themselves. They produce impressive brochures and direct you to a professional looking website.
Having gained your confidence they tell you that they have reviewed your pension and that it could be doing much better. They claim to know of a new unusual investment that promises guaranteed returns and will allow you to take a cash sum from your pension now. They might warn you that your current pension provider will do whatever it can to hang on to your pension pot by claiming that “due-diligence is needed”.
It might be many years before you realise that in fact the “unusual investment” never existed and that you have been defrauded out of your life savings.
What can you do?
There are simple steps that you can take to reduce your risk of being a victim:
- Reject unsolicited calls or emails; legitimate companies should not contact you out of the blue.
- If you have been contacted, check the FCA register or FCA warning list at https://register.fca.org.uk/
- If you are still thinking about investing, seek independent financial advice from an FCA regulated firm.