Wealth Management News

Warnings issued as £1.8 million of pension fraud hits savers in 2021

Fraud and cybercrime reporting centre, Action Fraud, has reported a spike in pension fraud during the first quarter of 2021.

Pension fraud cases had declined 80 per cent from 1,788 in 2014 to 358 in 2020, however, the latest data from Action Fraud shows a 45 per cent year-on-year spike in reports so far this year.

It is estimated that around £1.8 million has been lost by savers as a result of pension fraud in the first three months of 2021 alone.

In response to this sudden increase in criminal activity, Action Fraud has called for savers to “remain vigilant and protect their pensions”, as 107 cases have been reported to them since the turn of the year, with much more fraud likely to have taken place, but gone unreported.

Pauline Smith, Head of Action Fraud, said: “It is incredibly important that instances of pension fraud are reported to Action Fraud”.

She added: “Every report helps police get that bit closer to the people committing these awful crimes.

“Reporting to Action Fraud also allows our specialist victim-support advocates to provide people with important protection advice and signpost them to local support services.”

To avoid becoming a victim of a potential scam, Action Fraud is urging savers to reject unexpected pension opportunities, research who they are dealing with in detail, avoid being pressured into decisions and be suspicious of ‘out of the blue’ calls, including calls from known contacts, organisations or financial institutions.

Mark Steward, Director of Enforcement and Market Oversight at the Financial Conduct Authority, said: “The best way to protect yourself is to know who you’re dealing with.

“Unexpected and unsolicited offers, free pension reviews, promises of high returns which sound too good to be true and pressure to make a decision quickly are all warning signs of a scam.”

Link: Pension schemes urged to step up reporting to stop scammers