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1 in 10 over-55s fear they have been scamming target

15 May 2018

Nearly one in 10 over-55s worry they’ve been targeted by suspected scammers since the introduction of the pension freedoms three years ago, but many are unaware how to report it, according to new research by Prudential. 

The study found that 9% of over-55s had been approached about their pension funds by people they now believe to be scammers, while one in three (33%) said the risk of being defrauded of their major savings was of huge concern.

Offers to unlock or transfer funds are tactics commonly used to defraud people of their retirement savings.

Despite this, nearly half (49%) of those approached said they did not report their concerns because they did not know how or were unaware of who they could report it to.

The most recent pension fraud figures from ActionFraud showed 991 cases have been reported since the launch of the Pension Freedoms in 2015, involving losses in excess of £22m.

Yet Prudential’s research revealed that fewer than one in five (18%) of those approached by suspected scammers had reported it to authorities.

Nearly half (47%) said the approach involved offers to unlock pension funds or access money early, while 44% said the approach was for pension transfers.

More than one in four (28%) of those targeted were offered alternative investments such as wine, while one in five were offered overseas investments. A further 13% said scammers had suggested cryptocurrencies.

Vince Smith-Hughes, retirement expert at Prudential, said that while pension freedoms were “enormously popular”, they have created a “potentially lucrative opportunity” for scam artists.

He commented: “If it sounds too good to be true then it usually is and people should be sceptical of investments that are offering unusually high rates of return or which invest in unorthodox products which may be difficult to understand.

“The Pensions Advisory Service, FCA and The Pensions Regulator are doing good work raising awareness of the risks of scamming and by reporting suspected scams consumers can help the authorities tackle the issue and maintain confidence in pension freedoms.”