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Combatting pension scams: tactics learnt from public health experts

In certain ways pension and investment scams and the coronavirus are quite similar – they both target vulnerable people, especially those of an older age, they mutate and appear in different variants, and they can have a prolonged impact. By comparing how the pandemic and scams have been tackled, this blog reflects on current scam prevention efforts and suggests ways of improvement.

Reduce transmission channels

When the pension cold call ban was first consulted on in 2017, we called for the ban to expand and cover emails and text messages, and to monitor cold calling in relation to retail investments. Two years after its introduction, we now see scammers using online channels, social media and overseas call centres to dodge penalties. Stopping online scams has proven incredibly hard, as taking scam advertisements and fake websites down relies heavily on reporting and collaboration with big tech companies. A provider has recently reported seeing 32 fake websites at once, and it could take months to remove them from the internet.

There is an urgent need to consider how online advertising should be monitored and regulated. The Government has so far refused to cover financial harm in the Online Harms Bill. This is despite calls from the FCA, Which? and the industry; and some of the scams involving exactly the kind of user-generated content targeted by the Bill. The Prime Minister has recently committed to look at measures to protect people from online scams. We urge the Government to explore all possible legislative vehicles, especially the Online Harms Bill, as soon as possible.

Test and Trace

The test and trace equivalent in the scams world would be due diligence and reporting. The Pension Scams Industry Group (PSIG) has long been a pioneer in improving due diligence quality in the industry. Their Code of Good Practice has been adopted by many of our members and forms part of the Pension Regulator’s Pledge to combat pension scams. However, currently providers can only issue warnings and cannot stop customers from continuing a suspicious transfer if insisted. We look forward to seeing changes to the statutory right to transfer as outlined in the Pensions Schemes Act 2021, which will further enhance providers’ ability to stop transfers when warning signs are spotted. It will mean a critical new role for the Money and Pensioins Service (MaPS) in providing customers at risk with impartial and effectively compulsory guidance from a trusted source. This will ensure customers can be guided to make more informed decisions.

A lot more, however, could be done to improve reporting and intelligence sharing. Reporting has always been difficult because of the ambiguity in the definition of pension scams and the fact that the threat has shifted towards dubious retail investments. Under-reporting means it’s extremely difficult to understand the full scale of the issue, which impacts resource allocation. As suggested in a recent oral evidence session at the Work and Pensions Select Committee, Action Fraud could not investigate some scam reports due to resourcing issues. There is also a lack of centralised intelligence sharing for pension and investment scams, especially when compared to our general insurance counterpart. By developing a more holistic approach towards investment scams and potentially with aids from the Economic Crime Levy, we hope the situation could improve soon.    


There is unfortunately no vaccination against pension and investment scams. A few preventative measures, such as improving public awareness, will be critical to minimise their prevalence. We welcome the recent campaigns by the FCA , including a tool that checks whether an investment opportunity might be a scam. MaPS also plays an important role in guiding the public to make informed decisions for their retirement savings, and we recommend members to signpost their customers to the free PensionWise service whenever possible.

We would also encourage the regulators to consider whether there is a need to limit the investments available in pension products. Given the unique nature of pensions, permitted investment options should be better screened to prevent scams from being trojan-horsed into the entrusted investment landscape.

Post-discharge care

It is important for victims of pension and investment scams to have a straightforward way to report them. Currently, both FCA and Action Fraud offer helplines for scams reporting. Some of our members also have dedicated pages on their websites for customers to report scams. Reporting is important to protect customers from ‘secondary scamming’. We have seen cases where a claims management company, which offered to recover losses with a fee, was the same party who scammed the victim the first time. It also provides a secure channel to signpost victims to longer-term support, as scam victims might suffer from financial difficulty and emotional distress.   

Over the past year, we have seen great collaborations across different sectors in fighting coronavirus. Protection for the public during the pandemic has been strengthened by joint-up working and mobilising the community, to effectively prevent scams the same model needs to be applied.

Our expert panel will further debate the industry’s role in improving financial welling during our May webinar, you can sign up for it here.


Last updated 11/02/2021