This comes after pension scam losses exceeded £2.2million in the first halfof 2021, between January and May.
The average loss to pension scams so far this year was £50,949. This is more than double last year’s average of £23,689 according to Action Fraud.
The Pension ombudsman, Anthony Arter, said he “welcomes” the new campaign to tackle online pension scams and that “the total amount [of losses to scams] may be much higher”.
“It can take time before people realise they have been scammed and approach us for assistance.”
The new scheme, launched by the Financial Conduct Authority (FCA), is urging those planning their pensions to “flip the context” when researching pension offers.
They can do this, they say, by imagining how they would view the same offer viewed online if they received it in an everyday setting like a shop or pub.
Mark Steward, Executive Director of Enforcement and Market Oversight, FCA, said: “Imagine a stranger in a pub offering free pension advice and then telling you to put those savings into something they were selling. It is difficult imagining anyone saying yes to that.
They added: “Consumers are five times more likely to be interested in a free pension review offered online than in their local pub, despite this being a tell-tale sign of a scam”.
The research highlighted that 36 percent of pension holders are currently unable to recognise time pressure as a common tactic to push pension scams.
Time-limited offers are designed to push pension-holders into hasty, rash decisions about their pension.
Worryingly, despite 68 percent of pension holders saying they were “confident” they could spot signs of a pension scam, only 28 percent could spot a free pension review as a sign of a scam.
Only 50 percent knew to be wary by opportunities to transfer their pension.
The FCA lists the five most common warning signs of a scam:
– Being offered a free pension review out of the blue
– Being offered guaranteed higher returns – claiming they can get you better returns on your pension savings
– Offered to help to release cash from your pension, even though you’re under 55
– High-pressure sales tactics – scammers may try to pressure you with ‘time-limited offers,’ or even send a courier to your door to wait while you sign documents
– Unusual investments which tend to be unregulated and high risk
Overconfidence is of special concern, therefore, for the FCA as it can lead to pension holders letting their guards down, making themselves vulnerable to scammers.
Dr Papadopoulos said: Scammers will use behavioural tactics to trick you into a false sense of security. Often these criminals will manipulate and persuade you to do things in the moment, which ordinarily you would feel suspicious of in a more familiar setting, such as a shop or local pub.
Such a message as provided by this new message is more important now than ever before as 28 percent of pension holders feel more at risk now from scammers than they did before the pandemic struck.
Of that 28 percent, nearly two thirds felt that scammer tactics are becoming more sophisticated and trickier to spot during the pandemic.