05 September 2023

The Money and Pensions Service (MaPS) has published a report presenting the findings from a review of the evidence on the scale of pension scams in the UK, the impact on those affected, types of scam and tactics used by scammers, key risk factors and current trends.

The report also recommends actionable and evidence-based strategies and interventions that the Money and Pension Service (MaPS) and other stakeholders can adopt to lower the risks of scams and offer better support to those affected.

It has been reported that in 2021, reports of pension scams increased by 45%, and fraudsters stole over £2 million from people in the UK in just six months. This is likely to be a significant underestimate of financial losses, considering the Financial Conduct Authority (FCA) estimates that less than 1 in 5 instances of scams are reported. However, it has been stated there is little evidence on what governments and the industry can do to reduce pension savers’ susceptibility to fraud.

Some of the key findings from the report are:

  • significant methodological challenges remain in the estimation of the scale of the problem in the UK
  • the types of scams and the tactics are often very similar to investment scams more generally
  • the financial and emotional cost of pension scams is high. The impact of scams goes beyond the financial loss, potentially leading to a loss of confidence and trust, detrimental health outcomes and breakdown of relationships with family and friends
  • scams can happen to anyone. Once an individual has been targeted, there is a significant risk of re-targeting
  • MaPS as well as other organisations in the UK working to prevent pension scams and supporting those affected – such as pension providers – have at their disposal a range of touchpoints which lend themselves to interventions informed by the evidence presented in this review. Combined with already existing approaches, they can provide strong protection against scams.

Read the full news story and evidence review, here.

It has also been reported by the Pensions Expert, that pensions scams are being woefully underreported because the reporting structure is not fit for purpose, according to Margaret Snowdon, chair of the Pension Scam Industry Group (PSIG). In addition to this it has been stated that there has been a great deal of denial about reporting levels, and there is a danger that small reported numbers may encourage people to believe that pension scams are not a major problem. Read the full news story, here.

The Pensions Regulator website has a page dedicated on how to avoid and report pension scams .Find out more, here.

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