Are you about to invest in a pension scam?

Posted on Feb 15, 2019

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According to a recent article on the BBC website two victims of elaborate pension scams lost more than £1 million each to fraudsters. The two individuals lost their savings over the two years to June 2018. The data, from police reporting centre Action Fraud, has shown that victims lost £91,000 on average in 2017 by these types of scams.

Pauline Smith, Director of Action Fraud, said: “These statistics prove that the consequences of falling victim to a pension scam can be devastating. Victims can lose their life savings and are left facing retirement with little or no income.”

She added: “This is why it’s so important that you are vigilant if you receive an offer about your pension out of the blue and that you check who you are dealing with. If you think you have been a victim of pension fraud, please report it to us.”

Pension scams usually begin with an unexpected call, text, social media approach or email – offering a free pension review or a way to make attractive returns on pension savings. But the money may be simply stolen or transferred into a high-risk scheme completely inappropriate for retirement savings. Many offer eye-catching returns or high-rolling investments in hotels or green energy schemes that never materialise or instead lead to losses.

Some 10.9 million unsolicited pension calls and messages are made each year, according to consumer group Citizens Advice. This growth in scam calls is partly due the greater choice and flexibility which pension freedoms has given people. Overall, this is positive thing, but there’s also an argument that consumers feel they can now make some quite major financial decisions and ‘look after their own money’. Some schemes appear very attractive at first glance and, as we always say, if it’s too good to be true, it probably is’…

This is a challenging time to be making investments and stock markets across the globe are volatile, coupled with world economies slowing down. If we do experience a recession, then it’s likely that people will see negative returns from equities. In this marketplace, rather than investing in ‘get rich quick’ schemes, it would be far more prudent to have a well-diversified global portfolio, which should perform better over time.

In the meantime, a ban on cold calling about pensions is now in force and firms who break the rules could face penalties of up to half a million pounds. However, it is likely that many fraudsters may ignore the ban and people should remain vigilant.

If you are looking for an adviser, make sure that they are registered with the FCA, as this will give you additional peace of mind. At The Goodman Partnership we are registered with the FCA and have other accreditations too, which you can view on our website.  We have been based in Tunbridge Wells for over 30 years and would be delighted to assist you with your retirement and wealth management planning.


Goodman Chartered Financial Planners is a trading name of Fairstone Financial Management Ltd. Fairstone Financial Management Ltd., is authorised and regulated by the Financial Conduct Authority – FRN: 475973 Registered in England and Wales no: 05574120. Part of the Fairstone Group. Where you have a complaint or dispute with us and we are unable to resolve this to your satisfaction then we are obliged to offer you the Financial Ombudsman Service to help resolve this. Please see the following link for further details: