Personal Pension  

Half of older Brits miss pension scam warning signs

Half of older Brits miss pension scam warning signs

Over half of consumers are missing the tell-tale signs of pension scams, despite the Financial Conduct Authority’s campaign aimed at preventing people from investing in “dodgy investment scams”, according to new research from Zurich.

Of the 1,011 people in defined contribution schemes surveyed by YouGov on behalf of Zurich, 38 per cent said they would be willing to consider a ‘free review’ of their pension, when asked to consider a series of ‘investments’ for their retirement.

Around 23 per cent would consider an ‘investment scheme offering annual returns over 8 per cent’, while 14 per cent would consider a ‘legal loophole to pay less tax’. Only 36 per cent said they would not consider any of the schemes.

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Respondents were asked how concerned they would be of a potential scam if a company or individual contacted them unexpectedly with an investment opportunity for their pension.

The study found that 38 per cent would not be suspicious of an unsolicited letter, followed by 22 per cent not being dubious of an email, while 13 per cent would not be concerned if they were sent an investment opportunity by text message or via a knock at the door.

Despite 17 per cent of Britons over 50 saying they are not worried about falling victim to a scam, the findings raise concerns some savers could be more vulnerable than they think, Zurich said.

The FCA recently launched the next wave of its ScamSmart campaign, aimed at preventing people from investing in “dodgy investment scams” made easier by next week’s at-retirement reforms.

The regulator said that would-be investors should reject any cold calls, check their approved warning list and get impartial advice.

However, Zurich’s research also gave further evidence that messages about where to go for advice may not be getting through, with a quarter of people surveyed saying they would not know how to check whether an investment for their pension was genuine.

When asked to consider all the sources they would speak to before deciding whether to invest their pension in a scheme, a quarter also said they would listen to the company’s advice and a third would rely on their own judgement.

Gary Shaughnessy, chief executive of Zurich UK Life, commented that savers who miss the warning signs of a potential pension scam risk losing some or all of their hard-earned savings.

“Retirees should be on their guard against firms who contact them out of the blue offering a free review of their pension or an investment which sounds too good to be true.

“Our advice is to reject cold calls, check with the Financial Conduct Authority or Pension Wise and always seek trusted financial advice.”