Pension scams
The rules on private pensions changed in 2015, and people over 55 now have greater access to their pension pots. But there are criminals that want to take advantage of this. Here are some tips on how to keep your pension pot safe.
How do I spot a pension scam?
Fraudsters will try different ways to persuade you to part with your pension cash - from promising opportunities that are simply too good to be true, to giving you false information. They might:
- contact you out of the blue, either over the phone, text or email
- claim to know about loopholes that can help you get more than the usual 25% tax-free
- offer high returns of over 8% from overseas investments or new or creative investments
- offer a ‘loan’, ‘saving advance’ or ‘cashback’ from your pension
- suggest you put all your money in a single investment (in most circumstances, a financial adviser will suggest you spread your money across different schemes)
- send paperwork to your door by courier requiring an immediate signature
- say they'll help you access your pension pot before the age of 55 (unless you’re seriously unwell or have a certain type of scheme, this isn’t legally possible)
- pressure you into making a decision quickly
- only have a mobile phone number and/or a PO box address as contact details.
If you’re planning to take your pension early, check whether there will be any penalties. If it’s a workplace pension, you may need your employer’s agreement to do so.
Pension scams are serious. You could lose some, if not all, your pension savings, or end up with a large tax bill (there can be high charges if you withdraw your pension savings early).
Pension cold-calling banned
Nuisance calls about pensions are now illegal. If you receive a cold call about your pension, report it to the Information Commissioner's Office on 0303 123 1113.
How can I avoid pension scams?
If you’re considering investing your pension pot, talk to an adviser regulated by the Financial Conduct Authority (FCA).
- Find an independent financial adviser through Unbiased.co.uk
- Check the FCA's register of firms, individuals or financial services
- Check the FCA's list of unauthorised firms and individuals
- Use the FCA's Warning List tool to check the risks associated with an investment opportunity
Your pension pot
Visit the Government's Pension Wise website for more information about your pension pot options, or call 0800 138 3944 to register your interest for an appointment.
What should I do if I’m targeted by a pension scam?
If you think someone might be trying to scam you don’t be embarrassed to report it, it can happen to anyone. Report it to the Information Commissioner's Office online or by calling 0303 123 1113.
If you've been a victim of a scam, report it to the police and also contact Action Fraud. The information you give to Action Fraud can help track down the scammer. You can report the scam online or by calling 0300 123 2040.
Further information
Here are some other organisations that can provide free and impartial advice.
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