More than 5m pension savers (42 per cent) are likely to fall for at least one of six tactics used by pension scammers, with the financially savvy just as likely to be fooled, according to regulators.
Research from the Financial Conduct Authority (FCA) and The Pensions Regulator (TPR) showed that people who are actively seeking ways to boost their retirement income are even more likely to fall for scammers’ tricks, with 60 per cent likely to be tricked.
Last year, 180 people reported to Action Fraud that they had been the victim of a pension scam, losing on average of £82,000 each.
Of the 2,012 pension savers surveyed, who were aged 45-65, nearly a quarter (23 per cent) of would pursue an offer of high returns in overseas properties, renewable energy bonds, forestry, storage units or biofuels despite all these being classed as high-risk investments.
Similarly, 23 per cent would engage with a cold call from a company asking to discuss their pension plans despite the government introducing a ban on pension cold calling in January.
Nearly a quarter said they would ask for website details, request further information or find out what the caller was offering, even if the call came out of the blue.
Helping savers to access their pension pot early is also a persuasive scam tactic, with one in six (17 per cent) interested in a company that could offer this. However, individuals who access their pots before age 55 face a tax bill of at least 55 per cent and up to as much as 70 per cent if this is classed as an unauthorised payment.
Other tactics included offering guaranteed high returns, which 13 per cent of savers would pursue, and offering free pension reviews, which 10 per cent of individuals said they would agree to.
The FCA and TPR have warned savers to reject any unexpected pension offers whether they are made online, on social media or over the phone.
They also stressed that individuals should check the FCA register to see whether a firm is registered before changing any pension arrangements and to get advice before making any decisions.