FCA issues warning over ‘free’ pension reviews


WarningThe Financial Conduct Authority (FCA) has warned consumers about cold callers offering free pension reviews.

The regulator is concerned that consumers are being targeted by unscrupulous and unregulated organisations, offering free pension reviews, often citing the changes in the Budget.

The cold calls, which often start with a text message, generally follow a similar script:

Our advisers can help you make the right decisions

Investment Sense team 150 px

Contact our team of advisers today:

0115 933 8433


Online enquiry form

  • An explanation that your pension is not performing; despite there being no evidence at this point to back up the suggestion
  • A claim that better returns could be found elsewhere, usually in high risk and often unregulated investments
  • A suggestion that a transfer to a SIPP (Self-Invested Personal Pension) or SSAS (Small Self-Administered Scheme) would be of benefit; again with little or no research to back up this claim
  • A request to sign over authority so information on the existing scheme can be gathered

It seems that since the Budget these unregulated firms have ramped up their activity, with some companies making false claims that they are working on behalf of the Government, or that they are providing the new ‘guidance’ announced by George Osborne.

Issuing the warning the FCA said: “Most of the companies making these offers are not authorised by us, though they often falsely claim they are acting on our behalf.”

‘We are also hearing that some callers claim to represent the Government after its announcement to introduce free retirement guidance. This initiative has not been launched yet. When it is we, and the Government, will provide further information.”

“Hang up!”

The FCA has advised people contacted by a cold caller who offers a pension review to simply hang up.

They also point out that a regulated Independent Financial Adviser is highly unlikely to be engaging in cold calling activity and that advice is not free of charge.

The regulator continued by saying: “If you are considering reviewing your pension arrangements, get independent advice from an authorised financial adviser.”

“Your adviser should consider whether they are suitable for you. For most individual investors, investing your pension money in unregulated investments is unlikely to be in your best interests. All investment alternatives should be considered and leaving your pension pot where it is may be the best decision.”

There are other ways to avoid being scammed:

1. Don’t ever reply to an unsolicited text or take a cold call
2. Only use regulated advisers
3. Remember there are no loopholes to the under 55 rule
4. Avoid risk and unregulated investments
5. Don’t be tempted by cash bonuses or commission kick backs
6. Don’t be rushed into a decision
7. Don’t be tempted, if it sounds too good to be true it probably is!

You can read more about ways to avoid being scammed out of your pension by clicking here.