Keep your pension safe from scammers, warns the Financial Ombudsman Service

• We have heard from more than 650 consumers whose pensions have potentially been targeted in the past five years. 
• To help people keep their pension safe, we are providing top tips to mark Pensions Awareness Week.
• We help settle financial disputes between consumers and their regulated pension providers.

We have dealt with more than 650 ‘pension liberation’ cases since 2020 – although the true numbers could be far higher as we can only look at cases involving regulated pension providers and advisers. Also, anecdotally sometimes people are too embarrassed to come forward.

The consequences of a pension scam can be devastating as people face losing their life savings. In addition, in some circumstances savers may also be liable to pay additional tax if their pension is accessed before the age of 55. The government recommends that pension savings should not be accessed before the age of 55, unless in particular circumstances, such as if someone is retiring because of ill health. Veering from those rules can result in tax charges of more than half the value of the sum withdrawn.

However, scammers can be convincing and typically persuade people to transfer their pensions to unregulated or overseas investments including hotel developments, storage units, forestry or even cryptocurrencies. In many cases, these investments simply do not exist – or if they do, they are far riskier than the consumer has been led to believe.

Andy Wright, Ombudsman Director said:

Falling victim to a pension scam can be absolutely devastating, both emotionally and financially. Your pension is the result of years of hard work, and often worth a lot of money, so how you manage it is critically important.

Be cautious if you’re approached with promises of big returns from unregulated schemes. These are often scams, and once the money is handed over, it’s usually lost for good.

If something does go wrong and you’re unhappy with how your pension provider or adviser has dealt with your complaint – you can come to our free, independent service and we’ll see how we can help.”  

Whilst victims of these types of fraud may be reluctant or embarrassed to speak up, it’s important to remember that our staff are trained to provide support, particularly to vulnerable consumers.

Scams of this kind can also be complex, so we gather insight from the cases we see and works with pension providers to try to ensure consumers receive the support they need. Even so, there are occasions when savers could have been given better warnings by their providers – when that happens, we can direct that some or all of the money be returned by the financial firm. But these can be complicated cases, which is why it is crucial that savers understand the terms and conditions of their pensions.  

As Pensions Awareness Week gets underway across the UK, we have today published top tips for keeping your pensions safe.

Top tips for understanding and keeping your pensions safe

1. If it sounds too good to be true, then it probably is

Scammers often promise high returns or guaranteed profits – but genuine investments often carry risk and profits can rarely be guaranteed.  Be vigilant of fake websites or suspicious text messages that appear from a legitimate source. If you suspect you might have already been targeted by fraudsters you should contact Action Fraud on 0300 123 2040.

2. Understand what you are paying for

Always check the fees, commissions or charges linked to your pension or any proposed investment. Regulated providers should clearly display all costs and the key features of a product in the documents provided at the outset. It is important consumers understand exactly what they are paying for.

3. Choose a regulated adviser and pensions provider

To help make the best decision about your retirement, only take advice from firms or individuals regulated by the Financial Conduct Authority (FCA). We can only investigate complaints against regulated firms. Check the Financial Services Register if you are unsure.

4. Keep informed

As the saying goes knowledge is power. Make use of trusted online tools such as Money Helper from the Money and Pension Service, which is free, impartial and backed by the government. Scammers thrive when people are unsure of the rules.

5. Don’t neglect your pension

Pensions are long-term products and people often collect several across their working life. Understanding what you have, and keeping an eye on it over the years will help you ensure it is meeting your needs. Ask your pension provider if there is anything you don’t understand.

Notes to editors

1. As well as complaints about potential scams, in the last financial year (2024/2025) consumers have also raised just over 7300 complaints against pensions and annuity providers. Issues ranged from administration, customer service, mis-sale and suitability of advice and delays.
2. Find more information about our approach to pension complaints.