This type of scam is more common now that people can access their pension from age 55. If you're under 55, you might be approached by someone promoting the benefits of early pension release schemes and encouraged to access your pension early.
The scammers may tell you to transfer your money into an overseas scheme or try to sell you a one-off investment opportunity. Once the money is transferred, the scammers could steal your pension funds.
Early pension release schemes are not authorised by HMRC and withdrawn funds could be charged at anything from 55% to 70% in tax. If you’re considering entering a scheme to access your pension before 55, the Financial Conduct Authority (FCA) recommends seeking professional advice.
How to protect yourself
Pension cold calling is banned by the FCA. If you’re contacted out of the blue by phone, email or text message by someone you don’t know, it’s probably a scam. If you’re considering an early release pension scheme, it’s a good idea to get independent financial advice from a regulated firm.
What to do
Firms that are regulated by the FCA are unlikely to pressure you into making a decision. If they do, you should report them to the FCA straight away. You can check if they’re regulated by searching the Financial Services Register.
If you think you’ve become the victim of a pension scam, report it to Action Fraud on 0300 123 2040 or at actionfraud.police.uk.