Pension scams are big news at the moment. Whether that is articles in the national press or regulator funded warnings on television, it is a topic that needs careful consideration. In the current Covid-19 world, there will be many individuals who are feeling very vulnerable and as such are potentially ripe for scammers to prey on their circumstances.
Therefore it was very interesting to read an article in the financial press based upon a survey conducted by a pension provider. Their survey found that between 2015 & 2018 only 1 in 8 cases would have been flagged as potential scams whereas in the last two months, this figure has risen to more than half of all cases they received. It also highlighted a potential change in the style of scams possibly being undertaken. Previously the majority of scams originated as a result of an out of the blue phone contact offering a free pension review. This will be familiar as it is the basis of the current TV warnings from the regulator. Now however their appears to be a substantial increase in potential scams being triggered as a result of excessive fees charged for genuine advice.
The survey quoted above simply shows that scams can come in so many different forms. It is vitally important that individuals do not respond to so called free offers and that anything that sounds too good to be true, almost certainly is. It is equally important to keep in mind that whilst the Covid-19 crisis might make some people desperate for funds, you still should only be charged a fair price for advice from a reputable advisory practice and as such it always pays to shop around and compare the services you are receiving and more importantly the costs of those.
If you are worried about potential scams, please speak to either myself or Ian Dowdell or contact the FCA’s ScamSmart service at https://www.fca.org.uk/scamsmart