£2m lost to pension fraud so far this year

£2m lost to pension fraud so far this year

Action Fraud is warning savers to remain vigilant and protect their pensions, as research showed £1.8m has already been lost to pension fraud in 2021.

Action Fraud launched a national awareness campaign yesterday (April 20) to remind the public about the importance of conducting research before making changes to pension arrangements. 

Data showed a fall in pension scam reports from 1,788 in 2014 to 358 in 2020 — a reduction of almost 80 per cent.

Nevertheless, there has been an increase in reporting this year, with 107 reports of pension fraud received for the first time in the first three months of 2021. This is a rise of almost 45 per cent when compared with the same period in 2020. 

As reported by FTAdviser's sister publication Pensions Expert in March, a webinar survey carried out in the same month by Sackers showed of 77 trustees of defined benefit and defined contribution schemes, 35 per cent had had their data breached.

Almost half (45 per cent) of these breaches were reported to the Information Commissioner’s Office.

In 2019, the Pensions Regulator was the target of more than 343,000 email attacks, an increase of 148 per cent over the previous year.

Pauline Smith, head of Action Fraud, said: “Criminals are malicious and unapologetic when it comes to committing pension fraud. They are motivated by their own financial gain and lack any kind of empathy for their victims, who can often lose their whole life savings to these scams.

“We know pension fraud can have a devastating impact, both financially and emotionally, but any one of us can fall victim to a fraud and it’s nothing to feel ashamed or embarrassed about. It’s incredibly important that instances of pension fraud, and attempted scams, are reported to Action Fraud.” 

Smith added: “Every report helps police get that bit closer to the people committing these awful crimes. Reporting to Action Fraud also allows our specialist victim support advocates to provide people with important protection advice and signpost them to new local support services.”

Mark Steward, director of enforcement and market oversight at the Financial Conduct Authority, said: “The best way to protect yourself is to know who you’re dealing with.

"Always check the FCA register to make sure that anyone offering you pension advice or any other financial service is authorised by the FCA to perform the service they are providing for you, and that the details they are providing are the same as those on the register."

Rolhat Zen-Aloush is a reporter at FTAdviser's sister publication Pensions Expert