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Protect your pension

Action Fraud have reported a 400% increase in scams as a result of coronavirus-related fraud with total losses reachin nearly £970,000. It’s more important than ever to ensure the safety of your pension.

Pension scammers are targeting people like you with the average victim losing £91,000 each. But they’re targeting pension pots of all sizes so make sure you know how to spot the signs.

Scams are hard to spot and are often disguised with credible websites, testimonials and materials which make them look like the real thing.

To help you spot the signs and protect yourself from a scam, the Financial Conduct Authority (FCA) and The Pensions Regulator (TPR) suggest following four simple steps.

Step 1 - Reject unexpected offers

If you’re contacted out of the blue about a pension opportunity, chances are it’s a scam. Pension cold calling is illegal, and you should be very wary. An offer of a free pension review from a firm you’ve not dealt with before, is probably a scam.

Step 2 - Check who you’re dealing with

Search ScamSmart and check the FCA’s register to make sure anyone offering you advice is authorised. If they are, check they’re permitted to give pension advice by calling the FCA Consumer Helpline on 0800 111 6768.

If you don’t use an FCA-authorised firm, you risk not having access to compensation schemes.

Step 3 - Don’t be rushed or pressured

Take your time to make all the checks you need – even if this means turning down what seems to be an ‘amazing deal’.

Step 4 - Get impartial information or advice

You should seriously consider seeking financial advice before changing your pension arrangements. In some cases, for example where you are wanting to transfer more than £30,000 from a defined benefit scheme, you must obtain this advice.

TPR recently announced that savers looking to transfer from a defined benefit to a defined contribution pension during the coronavirus crisis will be warned it’s unlikely to be in their best long-term interests.

Consider using The Pensions Advisory Service which provides free independent and impartial information and guidance.

If you suspect a scam, report it to the FCA using this online reporting form and report it to Action Fraud.

Be ScamSmart with your pension. To find out more, visit www.fca.org.uk/scamsmart.

Take a look at our article on other ways to help your overall financial wellbeing here.