Last week, research from CAB revealed common pension scam warning signs are missed by nearly 90 per cent of people, while scammer’s tactics are also shifting away from pushing liberation schemes offering high rewards.
Gillian Guy, chief executive of Citizens Advice, told FTAdviser fraudsters have become more sophisticated, with many now offering free pension reviews and advice, making it increasingly difficult for people to work out whether an offer is genuine.
“When people do notice red flags, such as cold calling or unusually high investment returns, we found many aren’t checking in all the right places to see if an approach is genuine, with only a third of people looking a company up on the FCA’s register.
“The government and pension industry could really help consumers by encouraging them to use the register, and the FCA needs to make sure it’s simple and easy to use, to stop people falling victim to pension scammers.”
Julie McIntosh, a financial adviser at Clackmannanshire-based Solicitors Financial Services, complained people posing as advisers was a problem rife in her region.
“I’m concerned that a huge number of people don’t even think about checking to see if the people they are dealing with are regulated before handing over their life savings.
“They [The FCA] should be making it more user friendly for the public, so there wouldn’t be as many scams, as people would automatically look up an adviser they’re dealing with.”
Phil Billingham, a Chartered financial planner and operations director at Perceptive Financial Planning, called for one clear message from the regulator. “If the purported firm or adviser is not on the register, do not deal with them. It must be clear, specific and run by FCA for consumer protection.”
Bradbury Hamilton managing director Sheriar Bradbury, suggested a requirement for regulated firms to state their authorisation number with their FCA declaration, to make it easier for individuals to search on the register.
“A simpler way of stating the permissions that firms hold should also be created, as even people in the industry struggle to understand what all the different permissions mean, so what hope do ‘joe public’ have?” he asked.
Phil Stevenson, director of Cheshire-based Ark Financial Planning, agreed that its hard for those outside the industry to understand the terminology used.
“Better to have a simpler, more accessible register that outlines permissions in easy to understand terminology that the public can understand, such as ‘licenced to conduct pension transfers’, ‘licenced to conduct equity release business’, ‘licenced to transact mortgages’, etc.”
Kevin Croker, an IFA at Cheetham Jackson, added that while the register provides all the relevant information, the presentation could still be better. “The aim is to quickly tell someone who they are dealing with, whether they’re authorised and who they work for.”
A spokeswoman from the FCA responded that the register had a major update about six months ago, aimed at making it easier to use.
The site itself states that firms it has been told are providing regulated products or services without the correct authorisation – or are deliberately running scams – are now included with prominent warnings.
“Other information on unauthorised firms includes the different details they give out and whether they are falsely claiming to be from a genuine, authorised firm,” reads the front page.
The FCA spokeswoman added that the Scam Smart campaign was launched around this time last year and all subsequent messages have included the message to check firms on the register before doing business with them.
She also noted that in terms of terminology used within the register, the FCA is limited by what’s in the Regulated Activities Order.
The regulator’s business plan for 2016/17 mentioned that a new phase of ScamSmart would be rolled out later this year, including advertising and more information on the FCA website.
peter.walker@ft.com
