PA Northern Conference 2020: PSIG to update pension scams code in early 2021

The Pension Scams Industry Group (PSIG) is currently updating its code and intends to launch the next version “early next year”, according to PSIG chair and Pensions Administration and Standards Association (Pasa) president, Margaret Snowdon.

Speaking at the Pensions Age Northern Conference, Snowdon said version 2.2 of the code would be “up to date and in an easier to follow format”, whilst noting that PSIG also plans to expand on the Pension Scams industry Forum’s membership of around 50 companies in 2021.

The last version of PSIG's code, version 2.1, was published in July 2019.

Snowdon went on to explain that PSIG is actively trying to improve the Action Fraud process, adding that Action Fraud has now noted that the process has not been “user friendly” or focused on pension scheme reporting suspicions.

She also appeared to endorse the creation of a centralised pension scams organisation, stating: “The way things stand at the moment, we could be reporting to five different entities on the same issue and that is just plain daft. We need to get that sorted and have one place to report to, which will make life easier.”

Snowdon acknowledged that reporting suspected pension scams to Action Fraud was currently “very difficult” but argued that “if we do not report then we will never really know the truth”.

She also called on administrators to step up on the issue of pension scams, listing a number of ways in which they could make things more difficult for fraudsters.

Snowdon said administrators should seek to follow the PSIG code of due diligence, use the code to spot red flags, warn members when there are issues, refer insistent members to The Pensions Advisory Service, sign up to the The Pensions Regulator’s scams pledge and report suspect cases.

Snowdon commented: “What all pension scams have in common is persuading someone to move money from a registered pension scheme to another arrangement by misleading them about the risks, the nature of the investments, or the fees and charges they will pay.

“It should be noted that a scam isn’t always criminal, as it could just be sharp practice, but it causes harm nonetheless. Fraud is a high bar to prove and that is one reason why we don’t see many scammers caught and punished. Another is the lack of police resources to pursue scammers.”

Snowdon also examined whether defined benefit transfers could be made faster and safer, stating that the key to the issue was “processing the 80 per cent that are fairly standard straight away, so that more time can be spent on the complex cases”.

She continued: “If 80 per cent of cases can be dealt with quickly, the remaining 20 per cent will take longer, but they will be checked, communicated and dealt with correctly. The overall result will be faster, safer transfers, with fewer complaints and an improvement in industry trust.”

She also commented that “the bulk of the time on a transfer should be spent between the adviser and the member, the rest is transactional and can be improved if we want to”, but acknowledged that there was a big issue with “information going back and forth between the administrator and the adviser”.

Snowdon continued: “Often this is because the adviser doesn’t know the questions they should ask or what the information given means, and this needs to be fixed. We need better trained advisers, we need standard information requests and all the necessary information being provided at the outset.”

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