Pensions - Articles - Top locations around the world for financial fraudsters


Data uncovered by Phoenix has revealed that British pension savers are at a greater risk than ever of becoming the target of scams from across the world.

 Over recent times, Phoenix’s investigations team has seen a growth in the number of fraudsters using changes to the pensions and economic landscape as opportunities to market fraudulent schemes. The economic uncertainties around Brexit – and what this could mean for the value of people’s pensions – is the latest hook being used by fraudsters to get their hands on pension savers’ funds with scammers recommending savers move their pensions offshore for greater security or returns.
 
 To help savers recognise potential scams, Phoenix has compiled a few examples of global scams that have targeted their customers in recent times:
 
 Cape Verde – Suspicious firms advertising or arranging investments in unregulated alternative commodities, such as hotel developments or property. Phoenix has identified nearly 300 cases with a value of over £6.8 million since 2013
 
 Spain – Bogus stockbrokers are cold-calling UK investors and pressurising them into buying worthless shares or investments with the promise of high returns. The FCA reports that over £200m is lost in the UK every year.
 
 Brazil – Fraudulent “ethical” tree plantations in the Amazon rainforest where fraudsters claimed that investors could expect returns of about 10% a year from growing teak in the rainforests. 26% of victims who reported ‘Other Investment Fraud’ to Action Fraud over the past year were persuaded to transfer their pension monies from legitimate pension schemes into scam schemes with the promise of high returns in unregulated forestry investments.
 
 Russia – Organised international cybercriminals are infiltrating internal computer systems to gather information and steal sensitive data or fraudulently transfer funds. Since the EU referendum there has been a reported increase of fraudsters taking advantage of the atmosphere of worry by sending out Phishing emails that appear to be from the Government referring to Brexit. Cyber Crime is one of the fastest growing areas of criminality in the world. As technological innovations revolutionise the way business is conducted, sophisticated new opportunities for fraud have emerged and flourished. Indeed, it is estimated to cost the UK £27 billion a year and be the second most common form of economic crime impacting financial services firms.
 
 South Africa – Criminals intercept postal mail to obtain confidential data which is then used to takeover accounts or policies and instruct funds to be fraudulently paid out. Phoenix has identified over £300k worth (13 cases) this year, primarily impacting policyholders in Johannesburg. Intelligence indicates that the UK financial services industry has seen a growing number of non-UK residents become the target of postal interception, with South African residents disproportionately affected.
 
 Hong Kong – Members of the public have been cold called and offered 'free pension reviews', which recommend transferring pension savings overseas to Hong Kong, promising that doing so can double your money in 10 years' time. The customers are generally UK residents who seemingly have no intention to emigrate or retire abroad. 74% suspicious transfer requests have been to overseas schemes since the start of the year. This is a significant increase from last year when the figure was 9% for the month of June 2015. Phoenix has prevented approximately 28 cases totalling over £580k this year.
 
 These are just a few examples of the fraudulent schemes targeting savers. Phoenix recommends the following tips to avoid being a victim of fraud:
 
 1. Don’t allow yourself to be pressured into making a decision quickly. Pressure to make quick decisions may well increase the chance of you making a poor decision and is also an indicator of suspicious activity.
 2. Think about the contact you have received. Is this how the company usually contacts you? Would your pension provider really text you about fraud? Think about whether it's sensible for the company to make contact in that way.
 3. Do you need to pay up front? You should never have to pay to access funds due to you.
 4. If it sounds too good to be true, it probably is. Sometimes an offer may be framed in a way that will not arouse suspicion. Think very carefully about the risks.
 5. Be wary of any offers to access your pension early, before the age of 55. Ignore any unsolicited contact you receive on the subject - this could be via phone, text message, online, in person or the post. Watch out for elaborate sounding investments, particularly those based overseas. Check the FCA ScamSmart warning list for known investment scams.
 6. If you are unsure, you can call Pension Wise on 0800 138 3944, The Pensions Advisory Service on 0300 123 1047 or the Citizens Advice consumer service on 03454 04 05 06. To report suspected fraud you can call Action Fraud on 0300 123 2040 or visit http://www.actionfraud.police.uk.
  

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