Pension cold calls banned – but savers should remain alert
The ban also covers unsolicited texts and emails.
As many as eight scam calls are made every second – the equivalent of 250 million calls per year, research by the Money Advice Service found.
Pension scammers stole on average £91,000 per victim last year, according to the Financial Conduct Authority (FCA).
John Glen, economic secretary to the Treasury, said: “Pension scammers are the lowest of the low. They rob savers of their hard-earned retirement and devastate lives. We know that cold-calling is the pension scammers’ main tactic, which is why we’ve made them illegal.”
Despite the ban, savers are urged to remain vigilant.
“Prohibiting cold-calling is only part of the solution and will by no means eradicate the threat of scam activity altogether,” said Tom Selby, senior analyst at pension firm AJ Bell.
“Pensions remain a juicy target for fraudsters and some will inevitably look to circumvent the ban or simply ignore it altogether.
“The message to retirement savers from now on is crystal clear: if someone you don’t know calls out of the blue about your retirement pot, hang up the phone.”
The ban does not apply if the caller is authorised by the FCA, or is the trustee or manager of an occupational or personal pension scheme.
If the recipient of the call consents to calls or has an existing relationship with the caller, the ban also does not apply.
How to stay safe
Retirement firm Aviva has shared some top tips to help you protect your savings:
If you think you’ve been scammed – act immediately: If you’ve already signed something you’re now unsure about, contact your pension provider straight away. They may be able to stop a transfer that hasn’t taken place yet. Call the police service called “Action Fraud” on 0300 123 2040 to report it.
Hang up on all cold calls: Unsolicited phone calls, text or emails about your pension are now illegal. Scammers will often claim they’re from a government-backed body. These organisations would never phone or text to offer a pension review.
If something looks too good to be true: Beware of unregulated investments offering ‘guaranteed returns’. These include exotic sounding investments like hotels, vineyards or other overseas ventures, and deals where your money is all in one place – and therefore more at risk. Don’t be rushed into making a decision. Scammers will try to pressure you with ‘time limited offers’ or send a courier to your door to wait while you sign documents.
Make sure your adviser is registered: Scammers sometimes pose as financial advisers. Check your adviser is registered on the FCA website at www.fca.org.uk/register, and that they’re authorised to give advice on pensions. If you deal with someone who is not regulated you may not be covered by the Financial Ombudsman Service or Financial Services Compensation Scheme if things go wrong. And don’t be taken in by smart websites or brochures – professional-looking marketing materials are not a guarantee of a company’s authenticity.
Don’t let a friend talk you into an investment – check everything yourself People have fallen for scams because they’d been recommended by a friend. Do your homework, even if you consider yourself or your friend to be financially savvy. False confidence can lead to getting stung and with a pension, it might be years before you discover you’ve been scammed.