Pension scam warning during coronavirus crisis
Investors are being warned by financial services regulators to take care before making pension decisions during the coronavirus crisis.
According to The Pensions Regulator and Financial Conduct Authority (FCA), concerns about the pandemic could make people more vulnerable to financial scams targeting their pension wealth.
Before making important decisions about your pension, the regulators are encouraging savers to visit the Pensions Advisory Service website to read free plain English pensions guidance.
They also urge savers to visit the FCA’s ScamSmart website, to better understand pension scams so that they can protect themselves.
It’s a sad fact that scammers are more likely to take advantage during times of crisis.
Charlotte Jackson, Money and Pensions Service head of pensions operations, said:
“This is a very worrying time for people. For those on the point of retiring, the impact of the virus on the financial markets and therefore on pension savings has been damaging.
“If you are in a workplace pension, investments are designed to deliver over the long term with measures in place to reduce the risks faced by investors as they approach retirement.
“However, if you have chosen to invest your retirement savings yourself or were looking to retire soon then you may find yourself having to accept a lower income or retiring later. The key thing is to take as much time as you can and try not to panic.
“Most importantly, before taking any major decisions relating to your pension take the time to get independent guidance or advice. You can call the Pension Advisory Service on 0800 011 3797 or make an appointment with Pension Wise by going online.”
Mark Steward, FCA executive director of enforcement and market oversight, said:
“Fraudsters will exploit the coronavirus to prey on anxiety and fear of savers and investors, especially those who may be vulnerable. That’s why we’re urging anyone who is thinking about transferring their pension to check who they are dealing with and only use firms authorised by the FCA.
“Reject all unexpected and unsolicited offers; get to know the warning signs of scams, like high rates of return which sound too good to be true, so-called special offers or pressure to make a quick decision and check our tips and advice on our ScamSmart website.”
Charles Counsell, chief executive of The Pensions Regulator, said:
“Pensions remain a safe long-term investment for your retirement and it’s important to avoid hasty decisions about cash that’s taken a lifetime to build.
“We urge you not to transfer your pension into another arrangement now and regret the decision later. If you’re worried about your pension savings, take the time to understand what options you have available. There is no need to rush.
“For those who have a final salary pension, staying in your existing scheme is still likely to be the best long-term arrangement. All savers should be very cautious about making changes at this time.
“More than ever before, you should visit The Pensions Advisory Service website for impartial guidance before making any decision about your retirement or get financial advice from an FCA-authorised financial adviser.”
If you’re thinking about making pension decisions at this time, take extra care to ensure any approaches you receive are legitimate.
Always seek a second opinion from an FCA-authorised and regulated financial adviser, before making lasting decisions with your pensions or investments.