Lasting powers of attorney (LPAs) enable thousands of vulnerable people to have their financial and other affairs managed by others whom they trust. However, as a High Court case showed,...Continue reading
Scams of all shapes and sizes are becoming depressingly frequent and the Financial Conduct Authority (FCA) has warned against the rising tide of pensions scams that leave people facing years of misery in retirement as a result of passing their pension funds across to scammers.
According to the FCA the average sum lost is more than £90,000 and its response has been a campaign to raise awareness.
The theft of a pension fund often starts with an offer to have a ‘free pension review’ by a pension adviser, which is followed by an offer to move the pension fund into a scheme offering a better rate of return than the present one. The presentations are often very plausible and accompanied by convincing documentation.
The scammers trawl for people of the right age and will usually make an unsolicited contact (a ‘cold call’). The proposals made offer better than average returns – often ostensibly in overseas markets or enterprises offering the promise of better profits than in regulated schemes in the UK. Offering to ‘unlock’ money from the pension fund, the approach often emphasises the need to act quickly before the opportunity is lost.
In many cases, considerable time and effort is spent building up trust between the victim and the scammer before the latter strikes.
Once the pension fund is handed over, the pension adviser and the money both disappear.
The FCA recommends only taking financial advice from an authorised person, who is on the FCA register. If you invest with any entity that is not authorised by the FCA and suffer a loss, you are very unlikely indeed to see any of your money returned.
Secondly, do not act on calls, emails or social media contact from firms or people you do not know offering financial advice.
Never allow yourself to be rushed or pressured into making a decision and, if you have any doubts at all, get a second opinion from a person you know to be authorised by the FCA.