Signs of potential scam activity have been found in one in 12 pension transfer requests, Xafinity has found.
According to analysis from Xafinity’s pension scam identification unit, the signs of possible scams in transfer requests have reduced slightly from one in nine cases last year to one in 12 this year. This is still high, especially due to the increased focus on scams, Xafinity noted.
The analysis, which helps trustees identify potential pension scams connected with member transfers found that the most common flag for potentially fraudulent transfers, identified in 33 per cent of scam cases is the involvement of unauthorised advisers or introducers in the transfer process.
In addition, one in five, 20 per cent, of scams identified were a result of cold calling. Nonetheless, Xafinity emphasised that this is not the only method that scammers are utilising to seize pension savings from consumers, and while a ban on cold calling would be a positive step, it will only mean scammers take up other routes.
“This is where the government and other industry professionals need to work together to help make consumers safer and stop scamming damaging their retirement and financial security,” Xafinity said.
Xafinity head of pension scam identification unit Jackie Warwick said: “In many cases when we speak to the member it transpires that they have had no contact with the IFA who has signed off the discharge to the trustees. When a member realises that they have effectively been “advised” by someone they have never spoken to they often decide for themselves that something is wrong and therefore choose not to proceed with the transfer.
“Members often tell us how appreciative they are of the steps being taken by the trustees to protect them and their fellow scheme members from the threat of pension scams.”
Xafinity consulting actuary Ben Fisher added: “Our scam identification telephone service continues to identify tell-tale signs of scam activity that would be almost impossible to pick-up just from completed paper transfer forms alone. The perpetrators of pension scams will often step-in to complete the paperwork themselves to ensure it doesn’t contain any indication of a scam.”