Over the past five years, there’s been a dramatic drop in the number of unsuspecting adults being targeted by pension scam offers. Data from the Financial Conduct Authority’s Financial Lives survey paints a clearer picture of this trend. In 2017, a whopping 20% of adults, which is about 10.2 million people, were approached with these dubious offers. Fast forward to 2022, this number has shrunk considerably to 7% or 3.7 million people.
A Closer Look: Different Age Groups and Types of Scams
The older generation, particularly those between the ages of 55 and 64, have also seen a decline in these scam approaches. In 2017, 27% of this age group were targeted, but by 2022, it fell to 13%.
But it doesn’t end there. There’s been a noticeable drop in several types of scam approaches:
- Government Impersonation: Scammers, pretending to be the government and offering retirement planning advice, dropped from 14% in 2017 to a mere 3% in 2022.
- Free Pension Reviews: Offers for these so-called “free reviews” fell from 8% to 4%.
- Early Pension Access: Scams that promise early access to pensions (before the age of 55) saw a reduction from 6% to 2%.
- Investment and Cashback Offers: A small 2% of adults were approached with pension investment scams and another 2% were offered loans or ‘cashbacks’ for pension deals. And only 1% were pitched with the idea of transferring their pension for high returns.
Voices from the Inside: Experts Weigh In
Simon Kew, the head of market engagement at Broadstone, didn’t mince words when it came to expressing his views on the situation. He remarked, “Pension scams ruin lives and inflict immense financial and mental trauma on victims.” He praised the commendable progress in the fight against these fraudsters, pointing to effective actions from the regulator and the government.
However, Kew also sounded a note of caution, emphasising that the battle isn’t over. The industry must continue to be vigilant and play its part in spotting warning signs to protect its members. He also highlighted the ongoing need to educate the public about the risks associated with pension scams.
The Cost of Complacency
The urgency to address this issue can’t be overstated. Recent data from the Pensions Management Institute revealed that in the last two years alone, members lost a staggering £26.4m due to pension scams. While the latest figures indicate improvement, there’s no room for complacency.
In Conclusion: Stay Alert, Stay Safe
It’s heartening to see the numbers headed in the right direction. The collective efforts of regulators, the government, and industry insiders seem to be paying off. However, as we celebrate these achievements, it’s equally important to stay informed and be wary of unsolicited offers. Remember, a well-informed individual is the best defence against scams.