Common pension scam warning signs are missed by nearly 90 per cent of people research by the Citizens Advice Bureau found, reports FTAdviser.
Over-confident consumers think they can spot fraudsters, but many miss red flags such as high investment returns, cold calling and offers of free advice, the consumer rights body said.
Scammers’ tactics are also shifting, the Citizens Advice Bureau found, as they move away from pushing pension liberation schemes offering high rewards, towards other tricks such as ‘free’ pension reviews and ‘advice’.
Looking at a company’s website or talking unsolicited offers over with family members are often the only checks people do before handing over their life savings, the research found.
As many as 10.9 million consumers have received unsolicited contact about a pension since April 2015, based on data from an Office for National Statistics Populus poll for Citizens Advice.
The consumer body’s research also showed consumers aged 55-64 are most likely to take advantage of pension freedom rules and receive such calls. In this group, 33 per cent reported being contacted since April 2015.
Out of all the consumers surveyed, almost two thirds of consumers – 64 per cent – said they would consider an unsolicited offer about their pension and many would only consult informal sources about whether the approach is genuine.
When asked how they would check whether a pension offer was legitimate, almost half of those who would consider an unsolicited offer about their pension – 45 per cent – said they would look up a company’s website and over a third – 36 per cent – would discuss with family.
However, only one third of people – 33 per cent – said they would ensure the company is listed on the Financial Conduct Authority’s (FCA) online register.
Gillian Guy, chief executive of the Citizens Advice Bureau said: “Fraudsters have shifted their tactics to rob people of a retirement income.
“It’s difficult for consumers to stay ahead of pension scams as they evolve. Many scammers use professional looking websites and leaflets to fool their victims into signing up to free pensions advice or cold call with offers of unusually high investment returns.”
We would urge anyone wanting investment or pension advice to only deal with an FCA regulated financial adviser, which can be checked on the FCA website register.
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