How to avoid pensions scams

Why do pension scams happen?

Pension scams are on the rise. Your pension could be worth a lot of money – more than people usually have in cash savings.

Sadly, that means pensions are very appealing to scammers. They can go to great lengths to get their hands on your money.

What will PIC do, so you know it’s not a scam?

PIC will:

• never ask you to pay money to access your pension
• never ask you for your full bank account details or your Member Zone login details
• always go through our security checks: when you contact us, or we contact you, we will always ask for three pieces of identity information to make sure we are talking to the right person
• always give you time to make decisions
• always process your personal information in line with our data privacy notice, which you can find here Privacy policy - PIC.

If you’re unsure who’s called you or if you’re concerned it might be a scam, call us directly on 0800 652 7000 (UK) (or +44 1325 271 860 from overseas).

Things to look out for

Scammers create very attractive offers to persuade you to transfer your pension savings to them. Scammers might also pretend to be PIC or other FCA authorised firms. Remember if it seems too good to be true, it probably is. Here are some warning signs to look out for:

• contacting you out of the blue 
• free pension reviews
• offers of one-off investment opportunities with ‘guaranteed’ or higher returns
• early access to your pension (an offer to release funds before 55 is highly likely to be a scam)
• time-limited offers that need you to sign-up today
• unusual investments which are likely to be high risk
• complicated investment structures so it’s not clear where your money is
• being pressured to act quickly.

The risks

If you fall for a scam and transfer your pension to a bogus scheme not only could you lose all of your money, you could also be hit with a big tax bill as well. 

How to protect yourself from pension scams

Reject unexpected offers

• if you are contacted out of the blue about a pension opportunity, chances are its high risk or a scam. If you get a cold call about your pension the safest thing to do is hang up
• be wary of free pension reviews – professional advice on pensions is not free
• beware of being talked into something by someone you know. They could be getting scammed too.

Read the FCA’s information on how to Protect yourself from scams.

Check who you are dealing with

• use the FCA Firm Checker 
  • make sure that anyone offering you advice or other financial services is FCA authorised
    
  • check the firm reference number (FRN) and contact details you’ve been given match the details on the Firm Checker
  • check the firm is permitted to give pensions advice or the other financial services it is offering
• If you can’t check the firm’s details or have questions about Firm Checker, call the FCA consumer helpline on 0800 111 6768.
• if the firm is on the Register, call the FCA consumer helpline on 0800 111 6768 to check the firm is permitted to give pension advice
• check they are not a clone - a common scam is to pretend to be a genuine FCA authorised firm (called a ‘clone firm’). Always use the contact details on the Firm Checker, not the details the firm gives 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 or advice

You should seriously consider seeking financial guidance or advice before changing your pension arrangements:

• consider using a financial advisor - it’s important you make the best decision for your own personal circumstances so you should seriously consider using the services of a regulated professional (MoneyHelper has information on How to choose a financial adviser)
•  Pension Wise (0800 138 3944) - if you’re over 50 and have a defined contribution pension, Pension Wise offers free appointments with pensions specialists to talk through your retirement options
• MoneyHelper (0800 011 3797) - gives free, impartial guidance about money and pensions, and is sponsored by the government.

If you are unsure and need some help, please give us a call on 0800 652 7000 (+44 1325 271 860 from abroad)