Around 94 per cent of defined benefit transfers registered as having one or more scam warning signs, according to XPS Pensions.
The XPS’s Scam Flag Index found despite a slight fall from 97 per cent in June, this is the second month in succession where the rate has been in excess of nine in 10 cases.
The overseas investment amber flag required by the new transfer regulations was the most common warning identified.
Source: XPS Scam Flag Index
Client lead of the member engagement hub at XPS Pensions Group, Helen Cavanagh, said: “Despite the small fall in scam warning flags last month, we have now entered a period where almost all transfer requests lead to MoneyHelper referrals.
“Whilst many will ultimately be legitimate transfers, we are always wary that new more sophisticated scam practices will continue to evolve.”
Cavanagh added: “We welcome The Pension Regulator’s recent announcement of its plan to further help educate members and trustees about scams, to renew its effort to coordinate scam-fighting intelligence and to bring offenders to justice.”
Meanwhile, the proportion of members transferring rose to an annualised rate of 41 members per 100,000, representing a 41 per cent increase on the month before, according to the XPS Transfer Activity Index.
This is the highest rate recorded since January but remains far below the volume of transfer activity of recent years.
Last month, this figure was 29 members per 100,000.
Following a six-month period of decline, XPS Pension Group’s Transfer Value Index ended slightly up at the end of July at £210,000.
The increase was due to a small fall in gilt yields over the month.
Source: XPS Transfer Activity Index
In May, the group’s Transfer Value Index identified that the month-end average transfer value was £217,000, the lowest since June 2016 and in June, this was £203,000, the lowest value seen since November 2014.
Despite being the first increase in 2022, the XPS Transfer Value index remains 22 per cent below the record high seen in December 2021.
Head of member options at XPS Pensions Group, Mark Barlow, said: “Many pension scheme members will be finding that their household finances are under pressure due to the ongoing cost-of-living crisis.
“Although this is only one month, we have seen a rise in the number of members transferring, possibly to meet their increased income needs.”
Barlow added: “Whilst pension transfers can play a valuable role, it is crucial that members have appropriate support, including access to unbiased advice, to ensure that they make the right decision for them.”
sonia.rach@ft.com
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