Fears that scam artists would try to take advantage of recent pension reforms seem to have come to fruition, with one study estimating that more than a quarter of pension savers have been targeted by con artists.
DeVere Group, a financial consultancy firm, says that nearly 30pc of its clients have been approached by third parties offering to help them “liberate” their pensions over the past few months.
Under the new pension rules, people who have saved into a pension pot can access all their money as soon as they turn 55, subject to paying the relevant tax bill. The latest findings show that criminals see this as fertile territory for their fraudulent schemes.
The DeVere stats tie in with separate figures released by Action Fraud, part of the City of London Police, indicating that losses to pension-liberation scammers more than tripled in the month after the new rules were introduced.
“The alarmingly high figure from our poll, unfortunately, backs up our previously expressed fears that these pension freedoms will herald a boom time for criminals aiming to scam savers out of their retirement savings,” says Nigel Green, chief executive of DeVere.
“Now many pension savers have unprecedented access to significant capital sums, and the fact that more and more people are unsurprisingly seeking better returns in the current low interest environment, the fraudsters are increasing their activity to take advantage of this perfect storm.”
Mr Green adds that expats around the world are being targeted alongside over-55s living in the UK.
“These scammers are becoming ever-more sophisticated in their tactics to target retirees and those on the cusp of retirement,” he says.
“Typically, they tell their victims that they can benefit from ‘unrivalled returns’ by transferring their funds into often absurdly high-risk or bogus investments. In addition, they usually do not inform savers that their nest eggs can be decimated by high charges and taxes.”