LIFE & LIVING
The Sad Story of over 5 Million COVID-19 Scam Victims.
It’s estimated that over 5 million people have fallen victim to financial scams since the start of the COVID-19 outbreak. Carl Lamb highlights some of the danger signs to look out for.
Many of us are experiencing pressure on our finances as a result of the Coronavirus crisis, with turbulent markets and forecasts of difficult economic conditions ahead. It’s that nervousness that scammers are targeting with a range of special deals and not to be missed opportunities that are supposedly going to take all our worries away.
It’s as true today as it ever was that if something sounds too good to be true, it probably is. Please remember this. If you’re being offered high returns and low risk on an investment, please be sceptical and walk away. Never take advice from a financial adviser unless you know that they are from a firm that is authorised by the Financial Conduct Authority (FCA) – and ideally from a firm that is known to you or has been recommended to you by a real person. You can look up firms of advisers on the FCA register (www.register.fca.org.uk).
Firms of Chartered Financial Planners are registered firms that have attained the highest standards of expertise and experience in the financial advice profession. A Chartered firm will have a high proportion of individually chartered advisers and will have signed up to a stringent code of ethics.
Always check out anyone who approaches you out of the blue even if they are claiming to be from an organisation you know. You might be approached via a cold call, unsolicited texts and emails or even someone knocking at your door. These fraudsters look and sound like the real thing – pleasant, friendly and professional. They’re good at making it sound like they are doing you a favour by offering you their service but what they really want is to walk away with your money. Cold calling is actually banned within the financial advice profession so if you get an unsolicited call, then it’s not going to be from a genuine firm.
Scammers are paying particular attention to those of us with pension savings. You may be offered a free pension review and be told that your pension could be worth much more if you move it into a fund of their choosing. Don’t fall for this spin. Yes, it’s good to review your pension investments and strategy regularly but signing over your money to an unknown party is not the way to go about it.
There are fraudsters out there too who will tell you that you can access your pension savings early to help with your family finances if things are a bit tight at the moment. It’s another lie: you mustn’t access your pension savings until you have reached the minimum retirement age, which is currently age 55. If you do so, you will incur a hefty tax penalty – as well as losing your money entirely if you are persuaded to move it into a fake fund.
One of the sure signs that a scam is under way is the application of pressure on you to act quickly. The fake adviser may tell you that the offer is only available for a limited time or that you need to move your money quickly to take advantage of rising markets, for example. Never move more quickly than is comfortable for you and if you feel pressurised, walk away. A good adviser will understand that you need time to consider his or her advice..
Any opinions expressed in this article are subject to change and are not advice. Any solution described may not be suitable for everyone.
Smith & Pinching are Chartered Financial Planners. If you would like a no-cost exploratory review to discuss your financial planning with an adviser, call us today on 01603 789966 or email firstname.lastname@example.org