The Scale of Pension Fraud in the UK
Pension scams have cost UK savers hundreds of millions of pounds. Action Fraud reports that the average victim loses over £45,000 – often their entire retirement savings. Scammers have become increasingly sophisticated, using professional-looking websites, fake reviews, and even cloning legitimate firms.
Since 2019, cold calling about pensions has been illegal in the UK, yet scammers continue to find ways to target vulnerable savers through social media, email, text messages, and even search engine advertising.
Critical: If someone contacts you out of the blue about your pension, it is almost certainly a scam. Legitimate pension advisers do not cold call. Hang up, delete the message, and report it to Action Fraud on 0300 123 2040.
Common Pension Scam Tactics
| Scam Type | How It Works | Warning Sign |
|---|---|---|
| Pension liberation | Promises early access to your pension before age 55 | Claims you can unlock pension early |
| Clone firm | Impersonates a legitimate FCA-registered firm | Contact details differ from FCA Register |
| High-return schemes | Promises guaranteed returns of 8%+ per year | Returns too good to be true |
| Overseas investment | Transfers your pension to overseas schemes | Unusual overseas property or hotel investments |
| Free pension review | Offers a free review to generate transfer commissions | Unsolicited offer of free review |
How to Protect Yourself
- Check the FCA Register – verify any adviser or firm at register.fca.org.uk using the contact details on the Register, not those given to you
- Use the FCA ScamSmart tool – check pension and investment opportunities at fca.org.uk/scamsmart
- Never rush a decision – legitimate advisers will give you time to consider
- Reject unsolicited contact – do not engage with cold calls, texts, or emails about your pension
- Get impartial guidance – use Pension Wise (free, government-backed) before making decisions
- Check the FCA Warning List – this lists firms known to be operating without authorisation
Tip: Always contact a firm using the phone number listed on the FCA Register, not the number given to you. Scammers often clone legitimate firms and use different contact details to intercept your call.
What to Do If You Suspect a Scam
- Stop all communication with the suspected scammer immediately
- Do not transfer any money or sign any documents
- Report to Action Fraud on 0300 123 2040 or online at actionfraud.police.uk
- Contact the FCA consumer helpline on 0800 111 6768
- Tell your pension provider – they may be able to halt a transfer in progress
- Seek legitimate advice from an FCA-regulated adviser if you need help
FSCS Protection
The Financial Services Compensation Scheme (FSCS) protects pension savings up to £85,000 per person, per firm if an FCA-regulated adviser gives you unsuitable advice. However, this protection does not apply if you dealt with an unregulated firm or scammer, which is why checking the FCA Register is so important.
Frequently Asked Questions
Yes, since January 2019 it has been illegal to make unsolicited calls about pensions in the UK. If you receive a cold call about your pension, it is almost certainly a scam. Report it to the Information Commissioner Office (ICO).
Check the FCA Register at register.fca.org.uk. Use the contact details on the Register (not those given to you) to verify the firm. Also check the FCA Warning List for known unauthorised firms.
Pension liberation scams promise early access to your pension before age 55. This is illegal and can result in tax charges of up to 55% on the amount withdrawn, plus penalties. You cannot legally access most pensions before 55.
Recovery is difficult but possible in some cases. If you received advice from an FCA-regulated firm, you may be covered by the FSCS up to £85,000. You can also complain to the Financial Ombudsman Service. Report to Action Fraud immediately.
Key warning signs include: unsolicited contact, promises of guaranteed high returns, pressure to act quickly, unusual investment types (overseas property, storage pods), offers to unlock your pension early, and requests to transfer to unfamiliar schemes.
Not always, but unsolicited offers of a free pension review are a common scam tactic. Legitimate advisers may offer a free initial consultation, but they will be FCA-registered and will not pressure you into transferring your pension.
The average pension scam victim loses over £45,000 according to Action Fraud. Some victims lose their entire retirement savings. The emotional and financial impact can be devastating.
Clone firm scams involve fraudsters copying the details of a legitimate FCA-registered firm, including their name and registration number, but using different contact details. Always verify contact details directly from the FCA Register.