Savers need to be vigilant with their pension savings as there is an increasing trend of Covid-19 being used as a hook to commit fraud, APJ Solicitors has warned.

The firm noted that close to 2 million people are expected to face losing their job during the uncertainty of the Covid-19 pandemic and its aftermath, and, with people increasingly worried about their future, scammers are on the rise to push pension movement.

As many people struggle with the uncertainty of where their next paycheque might come from, people may look to their savings and, in many cases, their pensions.

According to APJ Solicitors, it is these behavioural trends that scammers are relying on in their search for the most vulnerable to target. Advisers from the financial mis-selling specialists are urging people to remain vigilant, especially as the pandemic is bringing new and unexperienced circumstances

“We found that on average hard-working Brits are losing £155,000 to unscrupulous advisers,” stated APJ Solicitors professional support lawyer, Glyn Taylor.

“We predict that this number may rise due to scammers taking advantage of people’s vulnerability and emotions during the pandemic. We urge people to remain watchful of scams and scammers. It’s important to remember: if it’s too good to be true, it usually is.”

APJ has found that many Brits have invested "huge amounts" of money into Costa Rican ethical forestry schemes, hotel resorts in Cape Verde, sustainable eco oil schemes in Cambodia and more, after being approached by cold callers.

Furthermore, amid the pandemic, fraudsters are attempting to lure victims with ‘healthcare opportunities’ and support for charities that cease to exist.

APJ warned that scammers are offering savers the opportunity to access your pension before the age of 55, which, during the current financial climate, could seem attractive to those who have been furloughed or worry about the risk of losing their job.

However, the promise of money before retirement age is false (unless there are extreme mitigating circumstances such as terminal illness), and any “legal loopholes” that may be stated by scammers do not exist.

Scammers often use tactics such as the offer of free pension reviews and time pressure to trick people into transferring large sums of money into fraudulent or risky schemes for high commission fees. Furthermore, investments in overseas schemes can be difficult to get the money back.

The law firm noted that the end result is often loss of investment and receiving a huge tax bill from the HMRC.

“With each new day, the pandemic is changing people’s lives at a rapid pace; scammers are using this to their advantage by putting pressure on victims to act now before it’s too late. To push victims into making a decision without checking the facts, many scammers and unscrupulous firms tell callers that the investment opportunities on offer are time-sensitive, or one-time-only offers,” Glyn explained.

Despite cold calls being banned in 2019, many scammers get around the ban by setting up call centres overseas and calling from offshore accounts.

APJ warned that it is therefore very important to remain aware and observant that cold calls can still happen, and that scammers are still very much active.

Phoenix Group risk and financial crime manager and Pension Scams Industry Group deputy chair, Tommy Burns, added: “Pension scams destroy lives and rob hard-working pension scheme members of the retirement they had longed for.

"Many face financial ruin as a result of one fateful signature on a piece of paper which transferred their pension into the hands of the scammers.

"The measures outlined in the Pension Schemes Bill are a step in the right direction but the amendment which we have proposed on the statutory right to transfer will help the industry to put a stop to many more transfers of concern.”

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