Pension scams

Avoiding pension scams

You need to make sure you’re keeping your pension savings safe from scammers.

You may think you won’t fall victim for a scam, but fraudsters have become increasingly sophisticated in their approaches, by producing professional looking brochures and websites promoting attractive but bogus offers.

In some cases, these fraudsters will target pension members offering the chance to convert their pensions savings to an immediate cash sum before the minimum pension age (currently age 55 but rising to 57 from 6 April 2028). Using a transfer of your benefits below the normal minimum pension age is usually against the law, so that sort of an offer should ring alarm bells with you.

Please read the following information carefully to ensure you don’t let a scammer steal your pension.

Understand the basics about your pension

First things first, you should get to know how your pension works to be aware of how scammers can trick you into thinking differently.

You can find out more about your pension in the Fund on the My Pension section of this website.

Some of the key facts that apply to all of our pension savings include:

  • The minimum age you can access your pension savings is currently age 55 (this will be 57 from 6 April 2028)
  • You can transfer out your pension at any age but a pension transfer must occur from one type of registered pension scheme to another
  • All legitimate UK pension schemes must be registered with HMRC and there are checks in place for overseas pension schemes
  • It is the law to seek financial advice if your transfer value is £30,000 or over

Reject unexpected offers and advice

If you’re contacted out of the blue about a pension opportunity, chances are it’s high risk or a scam.

If you get a cold call about your pension, the safest thing to do is to hang up - it’s illegal and probably a scam. Report pension cold calls to the Information Commissioner’s Office (ICO).

Be wary if you’re contacted about any financial product or opportunity and they mention using your pension. This is dangerous for you and your money.

If you get unsolicited offers via email or text, you should simply ignore them. Do not click on the links.

Be wary of offers of free pension reviews. Professional advice on pensions is not free. A free offer out of the blue (from a company you have not dealt with before) is probably a scam.

Don't be talked into something by someone you know, even a friend or family member. They could be getting scammed. Check everything for yourself.

Get regulated advice and protect your money

If you need advice about what might be best for your circumstances, please consider speaking to an independent financial adviser. If you do not already use a financial adviser, the Financial Conduct Authority website provides information in relation to finding an independent financial adviser at: https://www.fca.org.uk/consumers/finding-adviser

Before you appoint anyone, you should check that the adviser is suitably qualified and authorised. You can do this online at https://register.fca.org.uk or by phoning the Financial Conduct Authority helpline, 0800 111 6768.

Don’t be rushed

The last thing you need is to feel rushed or pressured into making a decision, this is how most scammers behave. Take your time to make all the checks you need, even if this means turning down an ‘amazing deal’.

Remember to do your research, and always refer back to checking that the financial adviser, or product, are authorised by the FCA and it is protected by the FSCS. This means if the adviser goes out of business and you’ve lost money because of the poor advice they gave you, the FSCS may be able to compensate you up to £85,000.

Be mindful

Be cautious when you hear phrases like ‘free pension review’, ‘pension liberation’, 'loan’, ‘loophole’, ‘savings advance’, ‘one-off investment’ and ‘cashback’. Most of these are key phrases used by scammers.

Other common phrases or actions used by scammers include:

  • Guarantees they can get better returns on pension savings
  • Help to release cash from a pension before the age of 55, with no mention of the HMRC tax bill that can arise
  • High pressure sales tactics – time limited offers to get the best deal; using couriers to send documents, who wait until they’re signed
  • Unusual high-risk investments, which tend to be overseas, unregulated, with no consumer protections
  • Complicated investment structures
  • Long-term pension investments – which often mean people who transfer in don’t realise something is wrong for several years

How to report a scam

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

ScamSmart: Don’t let a scammer enjoy your retirement