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Some pension scam victims lose more than £1 million to fraudsters

Some pension scam victims lose more than £1 million to fraudsters

Some victims of pension scams have lost more than £1 million in savings to fraudsters, newly-revealed data shows.

Data from Action Fraud, the national fraud and cyber crime reporting centre, reveals that two people have reported losing seven-figure sums.

It says this may only be a fraction of the total number who have handed over such large pension pots, as the majority of scam victims never contact the authorities.

Action Fraud's data also reveals that on average, victims of pension scams lost £91,000 each to fraudsters in 2017. They reported receiving cold calls, offers of free pension reviews and promises that they would get high rates of return – all of which are key warning signs of scams.

A ban on pension cold calling came into force earlier this month and firms who break the rules can face penalties of up to half a million pounds.

How can I avoid being scammed?

There are many things you can try in order to minimise the risk of falling victim to a scam.

Guidance from the Financial Conduct Authority (FCA) includes:

  • Reject unexpected offers. If you're contacted out of the blue about a pension opportunity, chances are it's high risk or a scam.

  • Check the FCA Register. Make sure that anyone offering you advice or other financial services is FCA authorised.

  • Don't be rushed or pressured. Take your time to make all the checks you need to make sure that a firm is genuine and an offer is good.

  • Get impartial information or advice. You should seriously consider seeking financial guidance or advice before changing your pension arrangements.

See the FCA website for full information.

If you think you've been a victim of fraud or if you suspect a fraudster has targeted you, contact Action Fraud (you can call it on 0300 123 2040).

What does Action Fraud say?

Action Fraud director Pauline Smith 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.

"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."