Most Scams Have Financial Adviser Involved

Last year the Pension Scams Industry Group (PSIG) conducted surveys involving Phoenix Life, Standard Life and XPS Pensions Group on the quality of advice given to pension clients.

The survey investigated over 27,000 pension transfers totalling £1.33 billion.

Their survey even ‘flagged up’ cases with advisers in a different country to the member, an unregulated introducer and an adviser that was already on an internal watch list due to previous concerns.

PSIG also found 49% of clients did not understand the advice they were given and did not really know who was advising them. Many people also did not know the details of the scheme that would be receiving their pension or what the costs involved were.

As reported in the financial Industry newspaper, FTSE Adviser, (PSIG) Chairwomen Margaret Snowden said: “We need to be aware that some scams may not be true, and the law needs to look at the way they will continue to deal with these scams”. She added: “Only 6% of pensions transfers came from cold calling but cases involving unregulated advisers were much higher.  In another interview, a SIPP manager suggested that the frequency of pension schemes scams had grown from 1 in 12 potential scams in 2017 to just 1 in 8 in 2018.  That’s a staggering 12.5% of pension scheme transfer applications being flagged as potential scams.

Comment

Even financial advisers have been scammed and then find themselves being sued by the injured party as scammers become ever more sophisticated in ‘conning’ both advisers and their clients.