HM The FCA and TPR are again warning investors to be careful of pension scams and are joining forces to highlight some of the most common scams and the likelihood of people falling for them. According to the report the likelihood of being drawn into one or more scams increased to 60% among those who said they were actively looking for ways to boost their retirement income.
Censuswide conducted research with 2012 adults about the six most common pension scams, the results are below:
1. Offering exotic investment opportunities- 23% of 45-65-year-old pension savers would pursue an offer of high returns in either overseas properties, renewable energy bonds, forestry, storage units or biofuels, even though these are high-risk investments and unlikely to be suitable for pension savings.
2. Calls out of the blue– 23% of 45-65-year-old pension savers would engage with a cold call from a company asking to discuss their pension plans.
3. Offering early access to your pension pot– 17% of 45-54-year-old pension savers would be interested in a company that offered to get them early access to their pension pot.
4. Guaranteed high returns on your pension savings– 13% of 45-65-year-old pension savers would pursue an offer guaranteeing returns of 11% on their pension savings.
5. Offering to review your pension for free – 10% of 45-65-year-old pension savers would say yes to a free pension review from a company they’d never dealt with before.
6. Time-limited offers– 7% of 45-65-year-old pension savers would say yes to a company who offered a special deal that won’t be around for long and offered to send a courier to sign the paperwork immediately.
The joint initiative was launched again this summer on 1 July and includes adverts on TV, radio and online to try and highlight the issue. More information can be found here.