If you've spent over 30 years working, and you're starting to think about retirement, you'll need to find a financial adviser you can trust.
Pension and investment scams can be surprisingly convincing, often featuring articulate, financially knowledgeable scammers backed by credible-looking websites, glowing testimonials, and professional materials that are almost indistinguishable from legitimate sources.
The Pensions and Investments Scam Playbook
Scammers craft enticing offers to lure you into transferring your pension and investment funds or releasing money from your pension pot. These funds are then funnelled into dubious, high-risk investments such as overseas properties, renewable energy bonds, forestry schemes, storage units, or simply stolen outright.
Common Scam Tactics
Unsolicited contact: Unexpected communication about your pension.
Promises of high/guaranteed returns: Offers that seem too good to be true.
Free pension reviews: Tempting but often fraudulent.
Early pension access: Promises of accessing your pension before age 55.
Pressure tactics: Urgency to make a quick decision.
Four Essential Steps to Protect Yourself
1. Reject Unexpected Offers
If you receive an unsolicited offer regarding your pension, it's likely a scam. Be especially cautious of free pension review offers from unfamiliar companies. Research shows that 95% of these unexpected offers are scams and are wisely rejected.
"Cold calling" is effectively banned under FCA rules unless you already have a relationship with the firm. In the situation where you know the firm, the adviser will always give you the option to terminate the call. If they don't - that is a breach of FCA rules and they could potentially be a scammer impersonating your adviser.
2. Verify Who You're Dealing With
Always check the Financial Services Register to ensure that the person or company offering you advice or financial services is authorised by the Financial Conduct Authority (FCA).
If you use a firm that isn't FCA-authorised, you won't have access to the Financial Ombudsman Service or the Financial Services Compensation Scheme, making it very unlikely you'll recover your money if things go wrong.
Verify the firm's credentials by calling the FCA Consumer Helpline at 0800 111 6768 or go to the FCA Register online: Register Home Page (fca.org.uk).
Be cautious of 'clone firms' - fraudsters pretending to be FCA-authorised. Use only the contact details listed on the FCA Register.
3. Don't Be Rushed or Pressured with any Pensions and Investments
Take your time to conduct thorough checks, even if it means passing up an "amazing deal." Be sceptical of promises of high returns that sound too good to be true, and never let anyone pressure you into making a hasty decision.
4. Seek Impartial Information and Advice
MoneyHelper (www.moneyhelper.org.uk): Offers free, independent, and impartial information and guidance.
Pension Wise (www.pensionwise.org.uk): Provides pre-booked appointments for those over 50 with a defined contribution (DC) pension to discuss retirement options.
Financial Advisers: For tailored advice, speak to an independent financial adviser. Ensure they are FCA-authorised and avoid taking investment advice from the company that contacted you or from an adviser they recommend, as this could be part of the scam. A financial adviser is required to inform you that they are "authorised and regulated by the Financial Conduct Authority" word for word - and you can always check their FCA number on the FCA Register: Register Home Page (fca.org.uk)
Suspect a Scam? Report It:
Financial Conduct Authority (FCA): Call 0800 111 6768 or visit www.fca.org.uk.
Action Fraud: Call 0300 123 2040 or visit www.actionfraud.police.uk.
Current Transfers: If you are in the process of transferring your pension, contact your provider immediately and then reach out to www.moneyhelper.org.uk.
Stay vigilant and informed to protect your retirement from scammers.
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