Pension scam reports drop 75% in 3 years

The number of pension scam reports submitted fell by 75 per cent between 2015 and 2018, from 1,353 to 345, a freedom of information request from AJ Bell has revealed.

The figures, obtained from the National Fraud Intelligence Bureau, also found that financial losses through pension fraud fell by 85 per cent during the same period, from £47.3m to £6.9m.

The pension cold-calling ban took effect in January 2019, and in the six months since its introduction the National Fraud Intelligence Bureau has received 215 pension scam reports.

Commenting on the findings, AJ Bell senior analyst, Tom Selby, said: “Financial fraud in the UK is mutating, with the number of victims of older-style ‘pension liberation’ scams dropping in recent years on the back of a series of government interventions – including the ban on cold-calling – and a significant industry-wide public awareness campaign.

“However, as pensions-based scam reports have fallen, the number of people falling prey to scams focused on their investments has continued to rise and look set to hit record highs in 2019.”

The same freedom of information request revealed that 8,000 investment fraud reports had been made in the first six months of 2019, almost double the amount during the same period in 2018 (4,113).

Investments were excluded from the cold-calling ban, something that Selby thinks the “government should review”.

He continued: “The surge in investment scam reports also suggests politicians and regulators need to focus their attention on this area.

“This might reflect the fact more people are now reporting being scammed to the relevant authorities, or it could be because fraudsters have shifted their focus to investment-based schemes.

“Although cold calling is just one tactic scammers use to target savers, it remains a common one which preys on the most vulnerable in society.

“Tackling the promotion of scams online is also a significant public policy challenge, although solutions here are complex given the global nature of social media channels in particular.

“The regulator must also continue its awareness-raising efforts to ensure people know fraudsters remain active and after their hard-earning cash.”

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