A new study testing people's understanding of pension fraudster's tricks by the Pensions and Lifetime Savings Association has revealed that nearly a third of the people surveyed failed to spot the most obvious pensions scams. The study provided more than 2000 people in the UK with a selection of situations that could be pension scams. 29% of people missed the most obvious scams.
James Walsh, policy lead for Engagement, EU and Regulation at the PLSA, comments:
"Research shows that consumers struggle to identify pension scams and are keen to see stronger checks. As an industry, we need to step up to this challenge and the Government's recent commitment to tabling an amendment to the Financial Guidance and Claims Bill to introduce a ban on pension cold-calling is a step in the right direction."
"Pension scams come in all shapes and sizes, as scammers become increasingly sophisticated. While the Government's ban on cold-calling is welcome, it is only part of the solution."
"There are other steps the Government can also take to help protect people's hard-earned savings. The PLSA is calling on the Government to make urgent progress towards introducing an authorisation regime for pension schemes. That will reassure people that they are only dealing with legitimate providers."
This month has seen The Pensions Regulator and the police launch an investigation into pension cold-calling scams, with the Regulator, concerned that some pension holders are being telephoned without their consent and being persuaded to transfer their funds into poorly-run schemes with false promises of high returns and upfront cash incentives.
There is good news however, the government have announced they will be working to quickly introduce a cold-calling ban regarding pensions, seen by many pension experts as essential to prevent people being scammed out of their pension pots. In a recent update, a Department of Work and Pensions spokesperson said:
"The government will continue to work swiftly to implement a cold calling ban by tabling a workable amendment to the Financial Guidance and claims bill, and then making regulations to introduce the ban".