Stolen UK identities selling for as little as £10 on the dark web
Cyber experts frequently warn that this is not a question of whether a person has been hacked, but how many times
The pensions industry is being called on to raise the alarm over suspected scams following a concerning long-term drop in reporting.
Data from the national fraud and cybercrime reporting centre, Action Fraud, shows a steady fall in pension scam reports from 1,788 in 2014 to 358 in 2020 – an almost 80% reduction.
In January, The Pensions Regulator (TPR) warned the Work and Pensions Committee investment fraud, where the source of funds may derive from pension assets, could be on the increase. However, a lack of data may be hiding the true picture of the pension scams landscape.
While there has been a slight rise in reporting so far in 2021, TPR is calling on industry to be on high alert for criminal or suspicious activity and to sign up to its Pledge campaign to help combat pension scams.
So far, more than 200 organisations have signed up to the Pledge campaign, which is designed in part to encourage better reporting. The campaign follows changes the regulator has made to protect savers in light of COVID-19 including the introduction of new scams training for all trustees, (as a new module of the Trustee toolkit), and a ‘warning letter’ for all those looking to transfer out of a defined benefit pension.
Action Fraud figures show pension scam losses can range from under £1,000 up to £500,000. But the true scale of the amount lost to pension scams, and the number of victims, is likely to be much higher as victims often don’t realise they have been tricked until many years later. Once the money is gone, it is often gone for good.
And with the COVID-19 pandemic impacting many peoples’ finances – despite the unprecedented government support – there are fears scammers will use this to their advantage to steal hard-earned cash from savers.
Pension scams are devastating. Scammers often approach people about a pensions or investment opportunity out of the blue with genuine sounding investments. They use sophisticated techniques to win trust before stealing people’s hard-earned retirement cash and can leave victims facing retirement with limited income and little or no opportunity to build back their savings.