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Pension freedoms may lead to influx of fraudsters

09/03/2015

The new pension freedoms allowing savers to access their pensions in full may lead to an influx of fraudsters trying to steal people’s savings.

Experts within the pensions industry have warned savers that the changes in pension regulations could encourage criminal activity. Under the current pension regulations, people can only transfer their savings to another pension scheme. In the past, fraudsters have set up fake pension schemes and convinced pensioners to transfer the money into them. From 6th April, anyone will be able to withdraw their pension savings and put them anywhere they like. This has lead to fears that it could lead to an “open season” for criminals, who will trick people out of their savings.

Tom McPhail, who is a pensions expert at financial adviser Hargreaves Lansdown told the BBC:
"It's open season for the fraudsters targeting the over 55's, and some unwary investors are going to get drawn into these schemes."

The government has warned savers not to accept any cold calls from anyone claiming to be a pension professional. It is believed that 15% of pension savers may have already been contacted by the fraudsters, and this is due to rise when the regulations are in place.

Pensions Minister Steve Webb has admitted that there are risks involved with making pensions savings easier to access. He has advised people to only take professional advice. He said:
"A lot of people will have access to a lot of money come April, and there's a bunch of crooks out there.
“Pension Wise-our service - is the place to go. Not somebody who cold calls you."

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