As part of this year’s Scam Awareness campaign by Citizens Advice, WEALTH at work is urging employers and pension Trustees to take proactive steps to help individuals protect their retirement savings

Figures from Action Fraud highlights the scale of the issue. In 2024 there were 519 reports of pension fraud in total and £17,567,249 lost, with an average loss of £33,848 per person. Research suggests the two most prevalent ways criminals target victims were investment fraud pressuring tactics, and account takeovers of a victim’s pension scheme by impersonating them.

Here are some key considerations to share with employees and members to help them remain alert and avoid losing their pension to scams and fraudsters.

• Scams don’t look like scams – Fraudsters often look and sound legitimate by having professionally designed websites and literature that mimic a genuine business, which is why it is easy to be deceived.

• If it’s too good to be true, it probably is – If an investment offers the opportunity of a lifetime, it’s likely to be a scam and there is little that can be done for those who fall for it. High-return offers should always be approached with caution and their legitimacy verified before taking any action.

• Scammers will do their homework – Fraudsters often go to great lengths to appear trustworthy. Those who run pension scams are clever and may have been able to get hold of someone’s personal details; not just about them, but their local area and interests. The familiarity can make their approach seems genuine. People need to be aware to avoid letting scammers’ knowledge and friendliness catch them off guard.

• The right decision takes time – Genuine advisers will never rush anyone to make a decision. Anything that is advertised as a limited time offer is likely to be a scam.
• Understand the basic facts first – Pensions can normally only be accessed at the age of 55, with the exception of seriously ill health. In normal circumstances, if a company promises to release pensions early, they are lying and it is a scam.

• Know where to go for help – People should approach any pensions or investing offer with caution and always check that the company is registered with the Financial Conduct Authority (FCA) before committing to anything https://register.fca.org.uk/.The FCA’s ScamSmart website also includes a warning list of companies for employees to be aware of www.scamsmart.fca.org.uk. It may also be a good idea for people to seek investment advice if they’re unsure.

• Protecting privacy – Scammers will use technology and try to contact individuals through various means such as social media, texts, telephone calls and emails. If anyone is in doubt, they should ignore it and hang up the phone or delete the message. Phone companies should be able to help by blocking any offending numbers and email providers with blocking emails from specific senders. Be aware of what is shared through social media and check that privacy settings are as secure as possible.

• Watch out for buzzwords - Common signs of pension scams include phrases like 'pension liberation', 'loan', 'loophole', 'savings advance', 'one-off investment', 'cashback'.

• Help stop the scams – In England, Northern Ireland and Wales pensions fraud or concerns about a potential scam should be reported to Action Fraud. For those that live in Scotland, they should call Police Scotland or Advice Direct Scotland. People should also report unauthorised financial advice and transfer concerns to the Financial Conduct Authority and breaches of pensions law to The Pensions Regulator.

Jonathan Watts-Lay, Director, WEALTH at work, comments; “Employers and Trustees are the first line of defence in protecting retirement funds and the regulator is expecting them to step up to the task. Providing financial education and guidance to members at retirement can help to ensure individuals understand their options and the risks involved. Arming them with the facts on what they can and cannot do with their pension and the potential risks involved will help them to make informed decisions and avoid making costly mistakes.”

He adds; “People also need to understand that taking investment advice and getting the additional consumer protection it offers should not be underestimated. The FCA is urging savers to consider seeking investment advice before making any big financial decisions which could be facilitated by employers and/or pension schemes.”

Watts-Lay explains; “Historically, there have been concerns over helping people gain access to advice but if done correctly, it does not carry the risk many presume. Having access to an adviser that has been vetted by the employer or scheme not only provides security, but the adviser will be more familiar with the structure of the scheme to provide a better quality of advice for members.

Providing a combination of good quality and timely financial education, one-to-one financial guidance and access to investment advice that have been subject to robust due diligence processes, will lead to far better outcomes for those at retirement.”