More than £2m has reportedly been lost to pension scammers since the start of 2021, with average losses more than doubling from last year, research from the Financial Conduct Authority (FCA) reveals.
The data shows that the average loss was £50,949 to May 2021, compared with last year’s average of £23,689. Individual losses reported ranged from just under £1,000 to as much as £500,000. The total lost during 2021 could be higher than £2m as many scams ‘often go unreported’, the FCA says.
Why the dramatic year-on-year increase?
- Fraudsters are using increasingly sophisticated ways to con people out of their money especially over the internet. Also these online scams are becoming more common and harder to identify.
- FCA research shows that savers are significantly more likely to be fooled by scammers’ tactics online than they would face to face.
- The regulator found that only 1.1% of pension holders would take advice from a stranger, but 9.95% would accept financial advice such as a ‘free pension review’ online.
Some of the most common online scams are:
- ‘Free' pension review
- 'High' investment returns
- Early cash release promise
- High pressure sale tactics
- Risky, unregulated investments
If you are being offered ‘advice’ and it doesn’t feel right keep these two points in mind:
- Don’t be rushed or pressured into making any decision about your pension.
- Reject unexpected pension offers, whether made online, on social media or over the phone.