An IFP corporate member has estimated that 8 out of 10 requests it receives for overseas pension transfers are scams to defraud savers out of their pension.
Aegon pension experts said they were seeing increasingly sophisticated ways of scammers trying to grab retirement savings.

It has warned about free pension reviews, which it said were designed to separate pensioners from their savings.

Since the start of the year the firm said it had prevented the fraudulent transfer of around 80% of transfers to Qualifying Recognised Overseas Pension Scheme, which customers had unwittingly authorised.

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The company said in a statement: “While QROPS can be perfectly legitimate where a UK resident wants to emigrate and take their pensions savings with them, they are increasingly being marketed by unregulated companies to transfer someone’s pension overseas, while taking a cut to cover administration fees.

“The fraudsters have typically been targeting smaller pensions of around £30k, promising to carry out a pension review, but their intention is to transfer the money overseas.

“Once it’s out of the country it’s possible the victim will lose their entire pensions savings. If it is not lost forever they may face a tax bill of up to 55% and other additional fees when the pension pot is repatriated.”

Kate Smith, regulatory strategy manager at Aegon UK, said: “The new pension freedoms have given people far greater choice about how they access their pension, but unfortunately this has opened the door for scammers.

“Fraudsters are not only plausible but are also highly persuasive and it can be all too easy to fall for their polished performance, unless you are on your guard. “We’re seeing more and more sophisticated ways of unscrupulous people getting their hands on people’s retirement savings and it’s not just the over 55s who are being preyed on, younger customers are being targeted too.

“We’re determined to protect our customers and crack down on the growing cases of fraudulent activity, but we need customers to be more aware and ever vigilant.”