The Financial Conduct Authority is investigating 20 alleged pension scams as part of its work on pensions-related misconduct, Andrew Bailey has revealed.
In a letter sent to the Work and Pensions select committee on March 7, the regulator’s chief executive said the investigations made up a "significant proportion" of the work being done by staff in the enforcement, regulatory and retail investigations division.
Mr Bailey was giving further context to the statement made by Deborah Jones, FCA’s director of life insurance and financial advice supervision, who told the parliamentary committee in February that the watchdog had 10 people looking at scams.
He said: "We flex the number depending on the need, for example, in response to a particular set of intelligence or multiple cases all arriving at the same time."
Mr Bailey said the watchdog’s pension scam intelligence team, which has six people on it, acted as the point of contact for all intelligence about pension scams across the FCA.
He said: "A typical pension scam may involve the pension scam supervisory team looking at the adviser firm advising consumers, a different supervisory team looking at self-invested personal pension operators that are holding the investment that may be central to the scam, another different supervisory team looking at any discretionary fund manager that is being as a wrapper underlying the Sipp investment, another different supervisory team looking at the underlying funds, the unauthorised business unit looking at the unregulated introducers sending the business to the adviser firm and an enforcement team which will work with the supervisory teams on urgent interventions using enforcement resource.
"Once the supervisory work is undertaken, the most serious cases are referred to enforcement for formal investigation."
Mr Bailey concluded: "Our approach to resourcing is deliberately flexible, but if we add up the time spent by our staff it is substantially larger than 10 full time equivalents."
In August, the FCA and The Pensions Regulator launched a joint advertising campaign to raise awareness of pension scams, as it was reported victims lost an average of £91,000 each last year.