Later this year, as part of the Pension Schemes Act 2021, the government is intending to introduce regulations that allow trustees or pension administrators to prevent transfers of pension benefits if they’re considered suspicious. This is to protect people at risk of being scammed.
In addition, the Pension Scams Industry Group (PSIG) has updated its code of good practice on combating pension scams, by making new recommendations to trustees.
Both these developments are in response to a huge increase in reported pension fraud over the last few years.
Action Fraud has revealed that £1.8m was lost to pension scams in the first three months of 2021 alone, and there were 107 reports of pension fraud. This is an increase of 45% on the same time in 2020.
In many cases, victims have been contacted by criminals posing as trusted professionals and have mistakenly transferred their pension benefits into a fraudulent account, losing all their savings in the process.
You should be reassured to know that for some time now, the Railways Pension Scheme has already been carrying out all these new PSIG suggestions designed to combat pension fraud. These are:
As a member of the Railways Pension Scheme, if you currently request a transfer, there are many, detailed security catches, authorisation steps and checks in place. You must fulfil all of these, 100%, before you pass even the initial phase of the transfer process.
After this, if we still believe the transfer request to be irregular, we would hold more telephone conversations with you. We report all suspicious transfer attempts internally, and we record all our findings.
These steps and procedures are not taken to delay you from accessing your benefits or processing the transfer, but carried out as a matter of course, to protect you from criminal activity and fraud.
Anyone can be at risk of fraud or scam at any time, but you are often most at risk of pension fraud when you’re close to retirement, have saved up a large amount into your pension, or you’re thinking of transferring. You must always be on your guard if you are approached out of the blue about your pension.
It is also a legal requirement for you to get independent financial advice if you wish to transfer your RPS (DB) pension into a defined contribution (DC) pension if the transfer value is £30,000 or more.
The Railways Pension Scheme has chosen Liverpool Victoria (LV) to give members access to trusted financial advice. LV can be contacted on 0800 023 4187. Or you can choose your own Independent Financial Adviser (IFA) in your area at unbiased.co.uk. Always check the Financial Conduct Authority (FCA) register here, at to make sure that a financial advisor is FCA-authorised.
For more information on how to spot scams and how to protect yourself, please check out our updated website page here.
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