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Pension scam warning

As the pandemic hits the finances of many, the authorities are airing fears that scammers will use this to their advantage to trick cash out of savers.

Nicola Parish, The Pensions Regulator’s Executive Director of Frontline Regulation, said: “To fight the scourge of pension scams and keep up with scammers’ ever-changing tactics, we need a clear understanding of the size of the problem and good-quality intelligence.

“While we’ve seen no evidence of a significant increase in pension scams during COVID-19, we believe many across the industry, including trustees, pension providers and administrators, are not reporting suspected scams at a time when the pandemic could leave savers more vulnerable.

“It’s vital the pensions industry reports suspected scams via Action Fraud, or by calling 101 in Scotland, which is why we made reporting one of the six principles in our Pledge to Combat Pension Scams campaign. We are working with Action Fraud and industry to ensure the reporting process is clear, understood and effective.”

Pauline Smith, Head of Action Fraud, the police reporting centre, said: “It’s vital that instances of pension fraud and attempted scams are reported to Action Fraud. Every report helps police get that bit closer to the people committing these awful crimes. Information provided in reports to Action Fraud also allows for quick-time disruption activity to take place, such as the removal of fraudulent websites and the blocking of telephone numbers being used to commit fraud, which helps prevent more people falling victim.”

And Margaret Snowdon, Chair of the Pensions Scams Industry Group (PSIG), a voluntary body, said: “There are lots of reasons for under-reporting. Schemes may not report because they think it is a hassle, they are not certain something is a scam, or they are concerned the report won’t be dealt with, but reports to Action Fraud are fundamental if scammers are going to be caught out by law enforcement.

“If we have better information on the scale of pension scams and the methods used, we are more likely to get the resources and attention we need to combat scams more effectively. The pensions industry must step up and improve reporting or it will make defeating scammers all the more difficult. The Pledge to Combat Pension Scams rightly requires schemes to commit to reporting suspected scams.”

As the police warn, scammers may approach people about a pensions or investment opportunity out of the blue with genuine sounding investments. They win trust before stealing. Action Fraud stats show a steady fall in pension scam reports from 1,788 in 2014 to 358 in 2020. However, victims may not realise they have been tricked until years after the fact.


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