Extra checks if you apply to transfer your pension
If you’re thinking about transferring your pension to another scheme, a recent change in the law could help protect you from becoming the victim of a pension scam.
Previously, if you applied to transfer your retirement savings elsewhere, the Trustee could do very little if it saw something suspicious. Now though, pension scheme trustees have new powers (and responsibilities) to help protect you and your pension.
What’s changed?
If you ask to transfer your pension, your application will be checked carefully for any signs that you may have been targeted by a scammer.
The first check will be to see if the scheme you want to transfer to appears on one of the ‘safe lists’ held by The Pensions Regulator. If it is, the Trustee can allow your transfer to go ahead without delay.
However, if it’s not, the Scheme’s administrator will ask you for some more information, usually about your employment or the country you live in. They’ll also be looking at your application for other warning signs that you might be at risk of being scammed. These include a series of ‘flags’; amber ones and red ones.
What do amber flags mean?
Amber flags are a way of saying that you should proceed with caution. If there’s one of these in your application, you’ll need to take some free guidance from the government-backed MoneyHelper Until you’ve received this guidance, your transfer can’t go ahead.
What about red flags?
Red flags mean ‘stop’. If there’s one of these in your application, the Trustee won’t be able to transfer your pension because there’s a very high chance that you’re being scammed.
If any flags are found in your application, the Scheme’s administrator will always write to let you know what the concerns are and what options you have.
Want to know more?
There’s a lot of really helpful information available online:
- To help you spot pension scams and for information about how you can avoid them, please click here to visit the Financial Conduct Authority’s website.
- You’ll also find some useful guidance by clicking here to visit MoneyHelper and then searching on “pension scams”.
- Finally, we recommend reading The Pensions Regulator’s leaflet called ‘Don’t let a scammer enjoy your retirement’. You can download it by clicking here.
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