If losing your long-awaited holiday was not bad enough, numerous social media reports suggest that fraudsters have already started to target people claiming to represent defunct travel agency Thomas Cook.
One post from a person who was not even a customer stated that they had been phoned by a “refund agent” who needed their full credit card details to process the transfer.
Shocked but not surprised
As reprehensible as this behaviour is, a survey from Canada Life strongly suggests that it should have been expected.
It found that one-in-eight (12%) non-retired UK adults have been approached – by phone, text or email – with offers of free pensions advice, a free pensions review, investment opportunities or a tax refund.
That was in just a three-month period.
Extrapolated across the country, that equates to more than 4.5 million adults who have potentially been exposed to a financial scam of some description, despite the ban on pension cold calling being introduced in January.
Simple rule of thumb
As a result, Canada Life has warned people to be alert to the dangers.
Andrew Tully, technical director at Canada Life, said: “Falling prey to a financial scam can be devastating, not only for the person involved but also for family and friends.
“Despite the ban on pension cold calling being introduced back in January, these unsolicited contacts offering ‘free pension reviews’ continue.
“People need to be on constant alert for any signs of scams, as the scammers continue to evolve and utilise ever more sophisticated and ingenuous ways of encouraging people to part with their hard-earned savings.
“Be scam aware and follow our tips to avoid the traps. Adopt the simple rule of thumb, if it appears too good to be true, it inevitably is. Simply walk away, hang up, or delete the email or text.
“There is no such thing as free money, after all.”
10 top tips
- If you receive an offer to help you access your pension savings before age 55 – It is only possible to do this in rare situations, for example if you are very ill, so always check with your pension provider before making any decisions.
- A recommendation to take a large amount of money, or your whole pension pot, in a lump sum and invest it elsewhere – Seek advice, check the ScamSmart website, and be very wary of unsolicited offers of ‘amazing investment returns’
- There can be significant tax implications if you choose to cash in your pension in one go, so check the tax position before you make any decisions. Tax calculators are available online.
- Warnings that the deal is limited and you must act now. This is a pressure tactic, making any financial decisions should not be done under pressure.
- HM Revenue & Customs will never contact you by email, phone or text informing you of a tax refund, so simply delete or ignore any contact made this way – HMRC will only contact you via post.
- You are discouraged from seeking professional financial advice or talking to Pension Wise or The Pensions Advisory Service (TPAS). An adviser would be able to explain the rules and tax implications of different options and help you make the best choices for your personal circumstances, so be very suspicious if this is discouraged.
- Contact by somebody who is not on the Financial Conduct Authority (FCA) register. The register is a public record of all the regulated firms and individuals in the financial services industry, including retirement income providers and investment companies.
- Check the FCA ScamSmart website for known scams and use the tools to help identify a potential scam.
- TPAS also has a great section on pension scams on its’ website.
- Check with your financial adviser, TPAS or your current pension provider if you have concerns, or call Action Fraud on 0300 123 2040 or online.
