• Figures obtained from the National Fraud Intelligence Bureau by AJ Bell through a Freedom of Information request reveal over 8,000 investment fraud reports have been made in the first six months of 2019, almost double the amount in the same period last year (FOI data attached)
• Figures point to a rapid surge in investment fraud reporting, with this year on track to break all previous records
• By contrast, the number of pension fraud reports have dropped rapidly from 1,353 in 2015 to just 345 in 2018
• Shift in focus to investment fraud raises questions about Government decision to exclude investments from cold-calling ban
Tom Selby, senior analyst at AJ Bell, comments:
“Financial fraud in the UK is mutating, with the number of victims of older-style ‘pension liberation’ scams dropping in recent years on the back of a series of Government interventions – including the ban on cold-calling – and a significant industry-wide public awareness campaign.
“However, as pensions-based scam reports have fallen, the number of people falling prey to scams focused on their investments has continued to rise and look set to hit record highs in 2019.
“This might reflect the fact more people are now reporting being scammed to the relevant authorities, or it could be because fraudsters have shifted their focus to investment-based schemes.
“Either way, these figures clearly demonstrate that scams remain a clear and present danger to savers who need to be vigilant when deciding how to invest their money.”
“The surge in investment scam reports also suggests politicians and regulators need to focus their attention on this area. In particular, the Government should review its decision to exclude investments from the cold-calling ban introduced for pensions in January this year.
“Although cold-calling is just one tactic scammers use to target savers, it remains a common one which preys on the most vulnerable in society.
“Tackling the promotion of scams online is also a significant public policy challenge, although solutions here are complex given the global nature of social media channels in particular.
“The regulator must also continue its awareness-raising efforts to ensure people know fraudsters remain active and after their hard-earning cash.
“Rather than waiting for the Government to intervene, the best way for people to avoid being scammed is to tool up their knowledge so they can protect themselves.
“And while scams have become increasingly sophisticated in recent years, a few simple steps can be taken to make sure you aren’t the next victim.”
Simple tips to avoid being scammed
• Watch out for investment ‘opportunities’ that appear out of the blue and sound too good to be true. Schemes offering high guaranteed returns are often at the heart of pension and investment scams.
• If you are cold-called about your pension or investments by someone you don’t know, hang up immediately.
• Be extremely wary of anyone offering ‘free advice’ or a ‘free pension review’. Advice is never free.
• If you are speaking to an adviser about your pension or investments, make sure they are regulated and check their credentials out via the FCA register.
• Don’t be rushed or pressured into making a decision about your pension – such tactics should set off a big red warning light in your mind and are often indicative of a scam.
You can find out more about the National Fraud Intelligence Bureau here: