Scammers target one in ten over 50s

Scammers target one in ten over 50s

One in 10 savers aged 50 and over believe they have been approached by pension scammers trying to access their savings, new research has shown.

Succession Wealth, which polled 2,315 people aged 50 and over with pensions savings, stated one in 20 of those contacted (5 per cent) believe they have lost money through one or more pension scams.

The research also found only 22 per cent of respondents who believe they were scammed reported this to the authorities.

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Of those contacted by pension fraudsters, 84 per cent claimed to have been approached in the past 12 months, with 6 per cent saying they were contacted more than 10 times.

The majority of savers were contacted by phone (68 per cent), and 27 per cent were approached via email. Some 4 per cent said they were visited by scammers in person.

The government banned pension cold-calling in January, meaning such calls, emails and texts, can incur fines of up to £500,000

In terms of the tactics used by pension scammers, the research showed 62 per cent of those targeted were offered a ‘free pension review’, and 42 per cent were told about an investment scheme that promised high guaranteed returns. 

Some 27 per cent said they were put under pressure to give an answer quickly, and nearly one in five were told about opportunities to use their pension savings to invest in other products, but were given no details of these. 

Mark Stokes, head of communications at Succession Wealth, said the research findings were alarming and illustrated the potential scale of the problem of pension scamming.

He said: "Some of the people being targeted are vulnerable and more needs to be done to protect them. The FCA’s Scam Smart initiative is very helpful in this regard.

"We are writing to all of our 20,000 plus clients to warn them of this problem. Given that we manage many of their pension plans, Succession is able to help clients ensure that they don’t become victims of this crime."

In August, the Financial Conduct Authority 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.

FTAdviser reported in March that the FCA is investigating 20 alleged pension scams as part of its work on pensions-related misconduct.

Ricky Chan, director and chartered financial planner at London-based IFS Wealth & Pensions, said fraud was a risk for every client, whether or not they have pensions. 

He said: "I presume the reason why pensions have been targeted in the past is because of the size of pension funds, and people are less engaged with, and less emotionally attached, to their long-term savings. 

"I believe with the recent pension cold-calling ban, this would significantly cut down the number of people being contacted by pension scammers over the phone. However, scammers by definition already know what they’re doing is illegitimate so I’m sure clients would still receive cold-calls regardless of the ban.