- 51% of UK adults – 27million people - have received or know someone who has received a suspicious communication in the last 12 months
- Younger people are more likely to know someone who has lost money, and are aware of someone losing more than older generations
- Almost one in ten (8%) communications are relating to pension transfers
Around half of UK adults (51%) have or know someone who has received a suspicious communication in the last 12 months according to new research1 from Canada Life. This equates to 27m people across the UK.
Most of these cases can be described “phishing scams” (51%), when a fraudster attempts to imitate a legitimate company or person to secure important information from the victim. Crypto scams are also becoming worryingly common, with 1 in 5 reporting they or someone they know has received one in the last 12 months.
Pension transfer scam communications account for almost one in ten (8%) of contacts, while romance scams or dating scams are similar at 11%.
Younger people are more likely to fall victim, and are losing more
Around a fifth (21%) of those who have, or knew someone who has been contacted, say they have lost money because of approaches by scammers. However, among 18 to 34-year-olds, this increases to almost half (46%).
The average loss to scams for themselves/someone they know was around £207, with this amount almost doubling to £361 for those aged 18-34 years old, compared to £112 for those aged 55+.
Andrew Tully, technical director at Canada Life comments:
“Scammers are a scourge of our society and continue to come up with devious ways to come between us and our hard-earned cash. In a cost-of-living crisis it may be all too tempting to try and make a quick buck or be attracted to market beating investment returns. Run a mile, these ‘get rich quick’ schemes will only pour more financial pain on those who unfortunately fall prey to the thieves and conmen.
“With crypto scams becoming more common, perhaps it’s unsurprising that more younger generations are being caught out. Not only are 18–34 year olds more likely to fall victim to a scam than older generations, but they are also set to lose more financially. It might be the case of ‘bet big, win big.’ But sadly, the reality is ‘bet big, lose big’. Scammers are often already heading for the door before you realise what is happening.
“With many families struggling to make ends meet, and as the cost-of-living squeeze tightens, offering easy access to your pension might seem the perfect opportunity to dig yourself out of trouble. The reality is you can’t access your pension savings before the age of 55, so it’s very likely it will be scammers.
“Follow the simple rule of thumb, if it appears too good to be true, it inevitably is. Simply walk away, hang up, or delete the email or text to keep your money safe from the scammers.”
Tips to help avoid financial scams
- If you receive an offer to help you access your pension savings before age 55, for example through ‘pension loans’ and ‘free pension reviews’. It is only possible to access your pension before age 55 in rare situations, for example if you are very ill
- Warnings that the deal is limited, and you must act now. This is a pressure tactic, and making any financial decisions should not be done under pressure
- HMRC will never contact you by email, phone or text informing you of a tax refund, so simply delete or ignore any contact made this way – HMRC will only contact you via post
- You are discouraged from seeking professional financial advice or talking to Pension Wise or The Money and Pensions Service
- Sign up for Action Fraud Alert, a free service provided by the National Fraud Intelligence Bureau. The service alerts about new types of crime or those which are increasing in their severity. If you sign up, you will receive those alerts which are relevant to you. https://www.actionfraud.police.uk/sign-up-for-action-fraud-alert
- Contact by somebody who is not on the Financial Conduct Authority (FCA) Register. The Register is a public record of all the regulated firms and individuals in the financial services industry, including pension providers and investment companies https://register.fca.org.uk/
- Be very cautious around any recommendation to take a large amount of money, or your whole pension pot, in a lump sum and invest it elsewhere, for example in overseas property, forestry, car parking or storage units. And be very wary of unsolicited offers of ‘amazing investment returns’
- Seek professional financial advice. A regulated financial adviser will be able to explain the rules and tax implications of different options and help you make the best choices for your personal circumstances, so be very suspicious if this is discouraged
- There can be significant tax implications if you choose to cash in your pension in one go, so check the tax position before you make any decisions. Tax calculators are available online including: https://www.canadalife.co.uk/tools/pension-tax-calculator
- Check www.fca.org.uk/scamsmart for known scams and use the tools to help identify a potential scam
- Source: Research among 2000 UK adults conducted by Opinium, with fieldwork between 12th – 16th August 2022.
About Canada Life
Canada Life is part of a group of companies controlled by Great-West Lifeco Inc., a diversified financial services holding company headquartered in Winnipeg, Canada. Through its subsidiary companies, Lifeco has operations in Canada, the United States, and Europe. Great-West Lifeco and its insurance subsidiaries have received strong ratings from major rating agencies. Great-West Lifeco has over 30 million customers worldwide and £1.341 trillion assets under administration (as at 31.12.21).
Canada Life Limited began operations in the United Kingdom in 1903 and looks after the retirement, investment and protection needs of individuals and companies alike.
Canada Life Limited is authorised by the Prudential Regulation Authority and regulated by the Financial Conduct Authority and the Prudential Regulation Authority. Registered in England and Wales no. 973271. Registered office: Canada Life Place, Potters Bar, Hertfordshire EN6 5BA. Canada Life Platform Limited, trading as Canada Life, is a subsidiary of The Canada Life Group (UK) Limited, and is authorised and regulated by the Financial Conduct Authority. Registered in England and Wales no. 8395855. Registered office: Canada Life Place, Potters Bar, Hertfordshire EN6 5BA.