Recent UK Finance figures suggest that scammers are ignoring, or looking to circumvent, the cold-calling ban by continuing to make unsolicited calls or moving to online platforms. In doing so, they’re costing unsuspecting Brits millions in stolen funds and ruining long-held retirement plans.

The half-yearly report found that fraudsters stole around £580 million from UK consumers between 1 January to 30 June 2023.

Keep reading for three red flags to look out for and what to do next if you think you’ve been contacted by a scammer.

1. Any unsolicited contact about a pension or investment via email, text, telephone, or in person

Pension cold-calling was banned in 2019 but it continues to be a huge problem.

UK Finance found that while only 17% of Authorised Push Payment (APP) scam approaches were made via telecommunications like telephone or text, these scams accounted for almost half (45%) of total losses – around £108 million in just six months.

While a pension cold-call is an immediate red flag, an unsolicited approach about any financial matter is highly suspicious.

A legitimate firm wouldn’t ever contact you out of the blue via telephone, text, email, or in person so be vigilant and treat any unexpected approach as a potential scam.

What to do next:

Hang up the phone, close the door, and delete any messages. Be sure not to click any links or return any calls.

If you feel confident in doing so, you can forward suspect emails to phishing@hmrc.gov.uk and text messages to 7726.

2. Any suggestion of investment guarantees or time-sensitive offers

Promises of guaranteed high returns or investments in unusual sectors or overseas property are all huge red flags. Remember, if an offer seems too good to be true it probably is.

Investment carries risk and there are no guarantees. Scammers might try to put pressure on you to make a quick decision by promising high returns but only if you act now. These tactics are designed to rush you into making a bad decision without completing the necessary checks.

Don’t fall for these tactics, no matter how much pressure a scammer applies.

Remember that firms operating overseas might not be regulated by the FCA. This means you won’t be protected if something goes wrong.

What to do next:

You should only deal with companies that are FCA-authorised to complete whatever actions the firm is promising to complete for you.

Independently search for the company online. That means not using a telephone number, a web address, or a link the potential scammer has given you but conducting your own research from scratch. Do this once you have hung up, preferably using a different device.

Clone sites and emails can be made to look genuine so look out for spelling errors, inconsistencies, and suspicious email addresses. Do the latter match the format of those on the organisation’s official site?

Finally, check the FCA register to ensure the firm is authorised.

3. Offers to help you access your pension early through a “loophole”

The minimum retirement age in the UK is currently 55 (rising to 57 in 2028). HMRC will allow you to access your fund earlier than this, but only if certain very specific conditions are met:

• You’re forced to retire early due to ill health
• A doctor confirms that you have less than 12 months to live
• You have a special pension with an earlier retirement age, possibly linked to your occupation.

If you access your pension before the minimum age without any of the above applying, this will constitute an unauthorised payment and HMRC will tax you accordingly.

In some cases, the tax charges could eat up the vast majority of your pension pot, leaving your retirement plans in ruins.

As with other scams, a fraudster could contact you through various means so always be on your guard.

What to do next:

If you think you have been contacted by someone looking to “liberate” your pension, contact Action Fraud by visiting their website at www.actionfraud.police.uk or calling 0300 123 2040.

You might also find useful information on the FCA’s ScamSmart site.

Get in touch

Scammers are forever evolving their tactics and they are happy to ignore the law to part you from your hard-earned money. Keep an eye out for the red flags above and if you have any questions about keeping your retirement fund safe, and your plans on track, get in touch. Email info@thepensionplanner.co.uk or call 0800 0787 182.

Please note:

The value of your investments (and any income from them) can go down as well as up and you may not get back the full amount you invested. Past performance is not a reliable indicator of future performance. Investments should be considered over the longer term and should fit in with your overall attitude to risk and financial circumstances.