There is seldom a week goes by without hearing that a large, well-known firm has been hit by hackers; the latest one was British Airways. You have probably seen the TV adverts warning of the dangers of retirement plans being ruined by fraudsters.
The Financial Conduct Authority (FCA), our industry regulator, recently published an online article designed to highlight the dangers and suggest how to protect yourself from fraudsters. We’ve lifted the advice from their article.
Four simple steps to protect yourself from pension scams
Reject unexpected offers
If you’re contacted out of the blue about your pension, chances are it’s high risk or a scam. Be wary of free pension review offers. A free offer out of the blue from a company you have not dealt with before is probably a scam. Fortunately, research shows that 95% of unexpected pension offers are rejected.
Check who you’re dealing with
Check the Financial Services Register (www.register.fca.org.uk) to make sure that anyone offering you advice or other financial services is FCA-authorised.
If you don’t use an FCA-authorised firm, you also won’t have access to the Financial Ombudsman Service or the Financial Services Compensation Scheme. So you’re unlikely to get your money back if things go wrong. If the firm is on the FCA Register, you should call the Consumer Helpline on 0800 111 6768 to check the firm is permitted to give pension advice.
Beware of fraudsters pretending to be from a firm authorised by the FCA, as it could be what we call a ‘clone firm’. Use the contact details provided on the FCA Register, not the details they give you.
Don’t be rushed or pressured.
Take your time to make all the checks you need – even if this means turning down an “amazing deal”.
Be wary of promised returns that sound too good to be true and don’t be rushed or pressured into making a decision.
Get impartial information and advice
The Pensions Advisory Service (www.thepensionsadvisoryservice.org.uk) – Provides free independent and impartial information and guidance.
Pension Wise (www.pensionwise.gov.uk) – If you’re over 50 and have a defined contribution (DC) pension, Pension Wise offers pre-booked appointments to talk through your retirement options.
Financial advisers – It’s important you make the best decision for your own personal circumstances, so you should seriously consider using the services of a financial adviser. If you do opt for an adviser, be sure to use one that is regulated by the FCA and never take investment advice from the company that contacted you or an adviser they suggest, as this may be part of the scam.
To read the full article, go to www.fca.org.uk/scamsmart/how-avoid-pension-scams.
If you have any doubts about someone contacting you about your finances, get in touch with us to discuss.