Don't get scammed!

Years ago, Nicky stopped over in Singapore on her way to visit family in Australia. On the first night, the tour guide issued a dire warning: “You might think it’s safe to leave your front door open at home, but here you have to be more careful. For instance, don’t leave your handbag on the counter when you shop, as someone might reach in and take your purse.”

At first, Nicky was worried. Then she remembered she lived in London, was always very security conscious, and never left her handbag unattended anyway. She relaxed and had an amazing holiday, untouched by even a sniff of crime.

Is your pension safe?

These days, unscrupulous crooks are less likely to pick your pocket or mug you on the street. But they are more likely to use technology to scam you, steal your identity or hack into your accounts.

For example, because of confusion around the new pension freedoms, skilled fraudsters are currently trying to persuade people to:

  • Transfer or reinvest their pension savings in a non-existent, inappropriate or high risk alternative
  • Release funds from a pension scheme that is registered with HMRC (resulting in unnecessary tax)

According to the FCA, £1.2bn is lost in UK investment scams every year.

According to Adviser Business Review in November 2016, an estimated 10.9m UK consumers have received unsolicited contact about their pension since April 2015.

According to MetLife, the percentage of people targeted by pension fraudsters in the South East was slightly higher than the national average, at 10%.

Would you be fooled?

Unfortunately, fraudsters appear articulate and financially knowledgeable. They have professional-looking websites and marketing materials, with credible testimonials. Even before the new pension freedoms were launched, the FCA had to shut down a ‘lookalike’ website that had been trying to pass itself off as the Government’s PensionWise site.

According to CAB research, 76% of 2,000 consumers were confident they could spot a scam.

Try this test. Before you scroll down to see the answer at the end of this article, which of these ads would you choose to contact?

Spot the scam

So what’s being done to stop the scammers?

The UK Government is considering:

  • Banning all cold calls that relate to pensions, including offers of a ‘free review’ (of course, they can’t legislate for calls originating overseas)
  • Limiting the statutory right to transfer your pension
  • Ensuring that only active companies can start a pension scheme
  • Allowing scheme trustees or managers to block a transfer that looks dodgy
  • Making members sign a declaration confirming they understand the risks

The Government is also considering whether to extend these proposals to include emails and text messages.

What to do

It may be nearly one-twelfth of the way through 2017, but it’s not too late to make a new year’s resolution.

Don’t get scammed!

Here are some sensible ways to avoid losing your hard-earned savings:

  • Note that HMRC-registered does not mean HMRC-approved
  • If something sounds too good to be true, it probably is
  • Never make a financial decision based on a cold call
  • If you’re called from overseas, just hang up
  • Don’t click links or open attachments in suspicious emails
  • Don’t feel forced to take action based on a time-limited offer
  • Avoid unregulated investments such as carbon credits, overseas property, land banks, fine wines and hospital car parks
  • Check the FCA warning list
  • Take FCA-regulated advice before you touch your pension
  • Trust the team at Plan 100 (if we contact you after we’ve previously exchanged correspondence or had a meeting, it’s not classed as a ‘cold call’)

For more information, check out:

This has been a public service announcement, brought to you by the lovely people at Plan 100.

Scam test: answers revealed

Now compare your choice with the CAB survey results:

  • 24% chose ad 1 (scam)
  • 64% chose ad 2 (scam)
  • 12% chose ad 3 (legitimate ad)

Did you get taken in?








Lance Baron

Certified Financial Planner (CFP) based in East Sussex, UK. We support people in Southeast England with more than £500K to invest by building a financial plan that will help them live the life they want… until age 100