Pension freedoms have opened the floodgates for scammers and conmen to prey on people who are keen to access their pensions. They are using increasingly sophisticated and convincing ways to 'con' people and one of the main ones is cold calling.

An estimated eight cold calls are made every second in Britain targeting private pensions - the equivalent of 250 million calls a year. New figures show people have been conned out of £43 million by pension scammers in the last three years, with the average victim losing £15,000*.

Many of these calls offer 'free pension reviews', or inducements to release or transfer funds, or to hold investments overseas in unregulated assets offering excellent returns. These are usually with tight timelines so you feel pressurised to take action. If an investment sounds 'too good to be ture' it so often is.

As a result, the Government propose to introduce two new changes:

  1. official ban on cold calls targeting private pensions, including text messages and emails. Businesses will only be exempt if the individual concerned has expressly requested information or has an existing relationship with the company
  2. stopping people transferring private pension pots into 'dormant' companies which are not actually investing any money.

It is hoped the ban will become law in 2018/19 once key pieces of legislation have been passed. In this way a clear message can be sent to consumers - put the phone down on cold callers immediately as no legitimate firm will ever cold call them regarding their pension.

In the meantime, we urge all our clients to be vigilant. If you want to discuss an investment proposal, please speak with a Dentons Wealth Financial Adviser.

*Source: Money Advice Service