A long-awaited ban on pensions cold-calling will come into force tomorrow (9th January) as the Government moves to protect retirement savers from scammers.
Tom Selby, senior analyst at AJ Bell, comments:
“Almost four years after the retirement freedoms were introduced the Government has finally taken a much-needed step to tackle the scourge of pension scams.
“However, prohibiting cold-calling is only part of the solution and will by no means eradicate the threat of scam activity altogether. Pensions remain a juicy target for fraudsters and some will inevitably look to circumvent the ban or simply ignore it altogether.
“The message to retirement savers from now on is crystal clear: if someone you don’t know calls out of the blue about your retirement pot, hang up the phone.
“It is also important to familiarise yourself with the tactics used by scammers and never hand over your hard-earned money to someone before doing appropriate background checks.
“You should be extremely wary of any investment ‘opportunities’ that promise eye-watering guaranteed returns or people claiming to be ‘advisers’ offering a ‘free pension review’. Professional advice is never free and so following the old maxim ‘if it sounds too good to be true, it probably is’ is a sensible approach.
“It’s also a good idea to make sure you know who you are dealing with. After all, your pension could be the most valuable asset you own, so don’t hand it over to someone unless you know their credentials check out.
“Slick fraudsters will sometimes pretend to be a bona fide company when in fact they are nothing of the sort, so have a look at the FCA register to see if the firm you are dealing with actually exists.
“And whatever happens, don’t be rushed or pressured into making a decision – such tactics should set off a big red warning light in your mind and are often indicative of a scam.
“Finally, if you’re at all unsure speak to a qualified, regulated financial adviser. You will need to pay for this but usually the benefit far outweighs the cost.”
