PIMFA welcomes Work and Pensions Select Committee investigation into pension scams

PIMFA, the trade association for the wealth management and financial advice industry, has welcomed the launch of an investigation by the Work and Pensions Select Committee of MPs into pension scams and their detrimental impact on consumers. 

PIMFA has raised significant concerns about pension scams for some considerable time. These concerns have only grown in the wake of Covid-19, which is why we launched our recent ScamSafe campaign.

As part of this initiative, PIMFA is producing advice on how to avoid scams, including advice on what information regulated wealth managers and financial advisers will never seek from clients through various forms of communication. PIMFA is also helping to communicate warnings about the latest scams that we have been informed about, providing information on how to find regulated financial advice and/or guidance and what to do and who to contact if consumers fear they have been the victim of a scam amongst an array of other information.

PIMFA, is working with existing partners, from its Financial and Mental Wellbeing campaign as well as those it has already worked with on investment fraud prevention, including, the Money and Pensions Service (MAPS), Financial Conduct Authority’s (FCA), Financial Services Compensation Scheme and Action Fraud among others.

Simon Harrington Senior Public Policy Adviser at PIMFA says: “Pensions scams have become a significant problem in recent years but in the wake of the Covid-19 pandemic PIMFA has become particularly concerned about the increase in scams aimed at people that might be approaching retirement and have seen significant losses in their pension fund in recent months.

“Another target of pension scammers have been those people approaching the age of 55 - though we have also seen evidence of people as young as 35 being encouraged to unlock the cash in their pension at the urgings of unscrupulous individuals.

“All too often consumers are encouraged to take money out of their pensions to invest elsewhere. They are told what they are investing in is low risk, while offering high returns. Moreover, such products are not always marketed to sophisticated or high-net-worth investors. In fact, according to the FCA, targets often include retiring police officers, nurses and those that have recently left the Armed Forces, while the average loss victims suffer is now as high as £82,000.

“PIMFA is extremely concerned about pension scams and feels that the public needs to have more information at their fingertips about the dangers posed by what are often very sophisticated scams. We look forward to contributing to the investigation of the Work and Pensions Select Committee with our recommendations of how to tackle this issue, and continuing our work with our existing partners.”