Retirees warned over pension scams after text alert
Pensions minister Steve Webb has warned retirees over the dangers of pension scammers after he received a text message from a suspicious sounding firm offering to review his pension savings.
Webb told a conference audience last week the government was aware criminals were looking to take advantage of the pension freedoms which were announced in last year’s Budget and work was being done behind the scenes as part of a crackdown.
In the Budget chancellor George Osborne announced measures to dramatically increase the flexibility of pensions at retirement, cutting the tax charge for people accessing their entire pension at retirement from 2015.
Under the plans, savers who take their pension as cash will get the first 25% tax free with the remaining 75% taxed at their marginal rate.
The reforms will take effect from April but have led to concerns over retirees being targeted by fraudsters offering high-yielding, but non-existent, investments.
Webb said those approaching retirement needed to be on their guard and that even he had received a text from a rogue firm.
‘I got a text. I thought it would be my daughter asking for money, but, actually, it says: “If you have a frozen pension prior to 55 you are now entitled to a free review. Please call back”.
‘People are going to have access to an awful lot of cash and wherever there is cash there are crooks.
‘We will do what we can to drive out the crooks. There is more going on than I can say because we don’t want the bad guys to know what we are up to. But buyer awareness is really very important.’