Pension Scams – Understand the warning signs
It’s a sad reality that pension scams are on the rise in the UK. As you are working hard to build your pension fund, scammers are working just as hard to get their hands on it.
At Scottish Friendly, we want you to be alert and avoid falling for these scams.
What is a pension scam?
A pension scam is a form of fraudulent activity which aims to take money from your pension.
Scammers will design attractive offers to lure you in; downplaying the risks to your money to try and persuade you to transfer your pension pot to them, or release funds from it.
Scam tactics include
Contact out of the blue
Scams can often begin with unsolicited contact. Cold calls about your pension have been banned, so please be aware if you receive a phone call, text or email out of the blue from a person or company you don’t recognise - there is a high risk this could be the start of a scam.
The offer of a `free` pension review
Professional financial advice normally isn`t free, and an offer of free advice is a red flag that it may be a scam. The safest way to get a proper review of your pension is to consult a regulated financial adviser.
Promise of high/guaranteed returns
To tempt you in, scammers often promise impressive or guaranteed returns. They may even downplay the risks. If it sounds too good to be true, it often is.
The chance to access, or `unlock`, your pension before age 55
You cannot normally access your pension before the age of 55 and HMRC will also penalise you for accessing your pension early. Is If someone offers to help you do this, it is very likely to be a pension scam that could lead to you losing money.
Pressure to act quickly
You may be told the offer is a one-time offer or must be acted on within a limited period. Decisions involving your finances should never be rushed and you should always take time to consider your options
What should I do If I’m contacted?
Don`t be rushed, or pressurised, into making a quick decision regarding your pension. Take your time and seek financial advice.
We have provided some helpful links below to help you keep your money secure.