Tommy Burns, Risk and Financial Crime Manager at Phoenix Group and Deputy Chair of the Pension Scams Industry Group comments

Pensions Awareness Day aims to help people to get the most out of their pension savings. But that opportunity is lost if they fall victim to a scam. Worryingly, financial fraud is growing, partly as a result of Covid-19, with scammers taking advantage of the upheaval and the additional financial pressures that some people are facing.

Pension scams can destroy people’s lives and rob hard-working pension scheme members of the retirement they have worked towards for years. Fraudsters often try to encourage pension savers to transfer their money to them, then they lose all their life savings. Those who fall victim can face financial ruin as a result of passing over personal data and just one fateful signature on a piece of paper which transfers their pension into the hands of the scammers.

Just this month the Police Foundation published some really important research that showed that even when pension companies flag their concerns to savers who are looking to transfer their pension savings to somewhere that does not look right, their concerns are often ignored. People can often think they are onto a really good thing, when they are about to lose all their hard earned savings. But if it looks too good to be true, it usually is. To help protect savers, Phoenix has called for an amendment to the draft Pension Schemes Bill, proposing that an individual’s statutory right to transfer is further limited. If that does happen, then pension companies will be able to do more to protect pension savers and help tackle pension scams.

But savers also need to be vigilant and aware of the threat. One of the very best ways to avoid being scammed is to learn more about the risks and to recognise when alarm bells should be ringing. While fraudsters’ methods are constantly evolving, there are some common traits to pension frauds. We all need to learn more and be vigilant.

Phoenix recommends that pension savers follow these key tips to help avoid being a victim of fraud:

1. Don’t allow yourself to be pressured into making a decision quickly. Pressure to make quick decisions may well increase the chance of you making a poor decision and is also an indicator of suspicious activity.
2. Think about how you have been contacted. Is this how the company usually contacts you? Would your pension provider, for example, really text you about a financial opportunity? Think about whether it's sensible for the company to make contact in that way
3. Be wary of any offers to help you access your pension early, before the age of 55. Ignore any unsolicited contact you receive on the subject - this could be via phone, text message, online, in person or the post. Watch out for elaborate sounding investments, particularly those based overseas. Check the FCA ScamSmart warning list for known investment scams. http://scamsmart.fca.org.uk
4. Do you need to pay up front? You should never have to pay to access funds due to you.
5. If it sounds too good to be true, it probably is. Sometimes an offer may be articulated in a way that will not arouse suspicion. It may be a promise of an amazing return on your investment. Think very carefully about the risks and where your money is going.
6. Do not hand over personal data until you know the company you are dealing with is regulated. If you have already done this and are concerned about how it might be used, contact your provider who can add additional security levels to provide further protection.
7. If you are unsure, you can call Pension Wise on 0800 138 3944, The Pensions Advisory Service on 0300 123 1047 which are both provided by The Money and Pensions Service (MaPS) or the Citizens Advice consumer service on 03454 04 05 06. To report suspected fraud you can call Action Fraud on 0300 123 2040 or visit http://www.actionfraud.police.uk

-Ends-

Enquiries

Leonie Garfield
Lansons
07530 626 212
leonieg@lansons.com

Rachel Esland
Phoenix Group
07892 705093
Rachel.esland@thephoenixgroup.com

Notes to editors

About Phoenix Group

Phoenix has become the UK’s largest long-term savings and retirement business following the completion of the ReAssure acquisition and is also the largest consolidator of closed life and pension funds in Europe.

Phoenix has businesses in the UK, Germany and Ireland, split across three key business segments: UK Heritage, UK Open and Europe.

The Group specialises in the acquisition and management of closed life insurance and pension funds (its Heritage business). Phoenix is a leader in the safe and efficient management of UK Heritage business. The UK Heritage segment comprises products that are no longer actively marketed to customers and has been built through the consolidation of over 100 legacy insurance brands.

In addition, Phoenix’s UK Open business manufactures and underwrites long-term savings and retirement products to support people saving for their future. These products are actively marketed to new and existing customers, primarily under the Standard Life brand. This segment is underpinned by a strategic partnership with Standard Life Aberdeen following the Phoenix Group’s acquisition of Standard Life Assurance Limited in 2018. Standard Life Assurance is a long-established expert in workplace pensions, personal pensions, long term savings and retirement solutions, and its customers and clients include individual savers and some of the largest employers in the UK, as well as professional advisers. The UK Open business includes a growing BPA business. Phoenix Group also has a market leading brand - SunLife - which sells a range of financial products specifically for the over 50s market.

The European business spans a range of both Open and Heritage products across three segments: Ireland, Germany and the International Bond in the UK. Our focus is on protecting our existing assets, optimising sales and driving efficiencies, which enables us to maximise value in these businesses and provides a platform for potential future consolidation in Europe.

Phoenix Group is a member of the FTSE 100 index, and has circa 14 million policies and over £300 billion of assets under administration.