An increase in pension scams led to the government announcing a ban on all cold calling in pensions in August 2017. There are several key facts that can help employers protect their employees from scammers:
- The Pensions Regulator (TPR) offers resources to alert employees including a video and booklet, and also suggests employers and trustees signpost employees to the government’s Pension Wise service.
- If employers or trustees have suspicions about a receiving scheme, they should tell the employee and record this communication. TPR will take this into account in looking at the non-payment of transfer values, and trustees needing more time for due diligence may apply for an extension to the normal six-month time period.
- The Pensions Liberation Industry Group has published a code of good practice setting out due diligence processes to combat scams.
- Financial advisers should be verified with the Financial Conduct Authority (FCA). Fraudsters are increasingly directing members to transfer into single member occupational schemes (known as SSAS) to escape scrutiny, but the receiving scheme provider can also be FCA-checked.
- To demonstrate what employees are up against, City of London Police says fraud victims are currently being targeted a second time by fake letters claiming to be from the National Fraud Intelligence Bureau. The letters claim they can help victims get back their money, but are, in reality, a second bite at the cherry.
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