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How to Spot and Avoid  Pension Scams

Anyone who saves into a pension scheme can be targeted with a pension scam, so it’s very important that you know how to spot the warning signs and how to protect yourself and your money.

What is a pension scam and how do they work?

There are different types of pension scam but most of them involve scammers offering you fake investment opportunities in a bid to make you transfer some or all of your pension savings to them. The effects of a pension scam can be devastating with some people losing their lifetime’s savings in one moment.

If you’re a target of a pension scam, the fraudster will get in contact with you via a phishing email, unsolicited phone call or text message. They will try to convince you of some kind of investment scheme and will promise you huge returns if you move your savings over to their pension scheme.

What are the warning signs of a pension scam?

No legitimate pension related companies or government organisations will contact you out of the blue regarding your pension.

In January 2019, all unsolicited contact via email, phone call, text, or in person, regarding pension savings was made illegal. This means that companies are not allowed to contact customers unless you have specifically asked them to. So, straight away, if you have been contacted in any way regarding your pension without asking, then you can be sure that it’s not legitimate. 

Other tell tale signs of a pension scam include:

High pressure sales tactics

Scammers will try to create a sense of urgency and may suggest that this is a one-time only offer and if you don’t act quickly then you’ll never get this opportunity again. This is all in attempt to get you to act quickly without thinking it through properly.

Guaranteeing high returns

Scammers will confidently promise you massively high returns if you invest your savings with them.

Overseas investment schemes

The investment schemes that the scammers offer will usually be overseas and unregulated with no customer protections in place.

Release savings before the age of 55

Releasing pension funds before the age of 55 can result in a large tax bill from HMRC, if it’s even possible which in the majority of cases, it isn’t. If a company is saying that you can release your savings without any mention of this, then it’s not legitimate.

Claiming to be from a government backed organisation

Some scammers will try to win you over by claiming to be from a government backed organisation like Pension Wise. There have also been cases of scammers pretending to be from Money Advice Service. Neither of these organisations, and no legitimate pension fund companies, will contact you out of the blue with advice regarding your pension.

No contact details

If you’re cold called by a scammer, they may say that you can’t call them back and everything has to be sorted over the phone if you want to go ahead. Or if you are given contact details via email or on a fake website, they’re likely to be mobile numbers and a PO box address.

How to protect yourself from pension scams

In order to avoid being caught out by a pension scam, make sure you follow these steps:

  • Reject all unsolicited contact regarding your pension. This includes phone calls, emails, text messages, or someone at your door. Legitimate companies will never contact you out of the blue.

  • If you’ve been contacted by a company and you’re not sure whether it’s a scam, you can either check the FCA Register of regulated firms, or the FCA Warning List of reported fake companies.

  • If you’re considering any investment opportunity, with your pension savings or not, make sure you seek independent financial advice from an FCA regulated company.

What to do if you think you’ve been targeted with a pension scam

If you’ve agreed to something that you’re now not sure about, the first thing you should do is contact your pension provider. If no money has been moved yet, they may be able to prevent the transaction.

If you think you’ve been targeted by a pension or investment scam, then you must report it on the FCA Scam Smart website (

If you’ve lost money through a scam, then report it to Action Fraud UK (

If you have any doubts about what you should do, then you can always call The Pensions Advisory Service (TPAS) on 0800 011 3797.


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