Artificial intelligence (AI) is making it harder for pension scams to be spotted, as fraudsters are finding it easier to create more convincing scams, Penfold has warned.

The provider said it was becoming increasingly important for employees to know how to check whether a request or message was legitimate, and employers had a growing role to play in combatting pension scams.

While it acknowledged pension scams were nothing new, advances in AI technology were making them more difficult to recognise, with fraudsters able to use AI to create convincing emails, clone websites and imitate trusted individuals.

This was resulting in traditional warning signs of pension scams being less reliable, Penfold added.

It argued that employers could play an important role in supporting employees by making pension scam awareness part of their financial wellbeing and cybersecurity communications.

Employees could be helped in recognising common warning signs through regular, practical reminders about pension scams, with employers urged to encourage employees to pause and verify any unexpected request relating to their pension.

Penfold said that creating a clear process for raising concerns with HR or a pension provider could help employees verify information before making important decisions.

“For years, people have been told to look out for poor spelling, unfamiliar email addresses or suspicious phone calls. AI is changing that,” said Penfold CEO, Chris Eastwood.

“While those checks are still very important, a scam can now look much more polished and convincing.

“The most important warning signs are often in what someone is asking you to do. Unexpected contact, pressure to act quickly, requests for personal information and promises that sound too good to be true should all give people a reason to stop and check.

“Most people only interact with their pension occasionally, which makes it even more important that every communication is clear, trustworthy and easy to verify.

“Protecting pension savings is a shared responsibility. Providers need strong security, employers can help raise awareness, and employees should feel confident taking a moment to question any unexpected request.

“A simple conversation or quick verification could prevent someone from losing their retirement savings to a scam.”

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