One in 20 transfers ‘dodgy’

One in 20 pension transfers are ‘dodgy’, Pensions Administration Standards Association (Pasa) president and Pensions Scams Industry Group (PSIG) chair Margaret Snowdon has warned.

Speaking at PASA’s annual conference yesterday, Snowdon revealed the results of The PSIG Scams Survey Pilot 2018 research into 27,000 transfers, worth £1.3bn.

“What we discovered is the more transfers, the more scams you find. We found that 5 per cent, which is one in 20, transfers that we process every day is dodgy. That’s quite scary,” she stated.

According to Snowdon, the research also found that 49 per cent of members within the transfers researched did not understand what they were doing.

“They had such a low understanding they did not know who their adviser was telling them to transfer,” Snowdon explained. “They didn’t know where the transfer was going. What that tells us is somebody is asleep at the wheel.”

However, Snowdon also emphasised the lack of recognition for the time and costs spent by the pensions industry to protect members against scams.

She highlighted how three organisations within the research spent 14,000 man hours and paid out over £1m in costs in trying to save people from falling victim to scams. “This should be applauded,” she added.

Earlier in February, PSIG revealed that The Scams Survey Pilot 2018 research found that the quality of advisers, including unregulated introducers, advisers in different countries from the member and advisers who have previous transgressions, is the greatest area for pension scam concern.

PSIG's survey consisted of information from three providers complied between January - December 2018. These were XPS Pensions Group, Phoenix Life Assurance Company and Standard Life Assurance Company.

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