Many people in the UK are, unfortunately, the victims of a pension scam, with a total of £30,857,329 ($39,654,753, €33,450,395) lost to such fraud since 2017.
But despite their best efforts to inform Action Fraud, UK’s national reporting centre for fraud and cybercrime, these cases do not end up being passed onto the police, according to a freedom of information (FOI) request by Quilter.
Some 394 pension fraud reports were submitted to Action Fraud in 2019, yet just 26 cases, little more than two a month, passed the review process and were given to the police to investigate.
Therefore, just 6.6% of pension scam reports received by Action Fraud were passed to the relevant police force for investigation in 2019.
It remains unclear how many, if any, of those investigations led to a criminal justice outcome.
History
The table below shows the consistent number of cases that are sent to the police.
| Year | Pension fraud reports received by Action Fraud | Pension fraud reports reviewed by National Fraud Intelligence Bureau | Pension fraud reports disseminated to the police and other agencies |
| 2015 | 1,353 | 208 | 208 |
| 2016 | 547 | 97 | 97 |
| 2017 | 409 | 62 | 62 |
| 2018 | 346 | 46 | 38 |
| 2019 | 394 | 46 | 26 |
| Up to July 2020 | 161 | N/A | 24 |
Source: Quilter
Crackdown
In light of the FOI, Quilter is urging the UK government to do more to tackle the threat of scams by making it harder for the criminals to operate and reach potential victims.
Responding to the Work and Pensions Select Committee inquiry on protecting pension savers, Quilter has called for measures to tackle some of the ways in which scammers target their victims online.
To do this, Quilter said the government should include scam adverts, fake websites and other financial harms within the scope of the Online Harms Bill, which was due to be introduced to parliament next year but no firm commitment has been made by the UK government.
In doing so, search engines and social media platforms will, for the first time, have a legally enforceable duty to remove suspected scammers and scam adverts immediately on notification and improve their due diligence process so that it becomes much harder for scammers to market investment products using paid adverts.
Perfect opportunity
Jon Greer, head of retirement policy at Quilter, said: “We are entering a period of considerable economic uncertainty, and one in which generating a decent return on your investments will be extremely challenging. This is the ideal environment for scammers to thrive and it is no surprise to see huge amounts of money still being lost each year at the hands of criminals.
“The fact that it is so hard to investigate and prosecute pension scams is effectively handing pension scammers a get out of jail free card. If you are mugged, it’s highly likely that the police will investigate, but lose your life savings to a pension scammer and your odds don’t look good.
“Pension scams and other investment frauds are extremely complex, they can span multiple jurisdictions, and can often go uncovered for years before the victim realises their money is gone. This all makes investigating the scams incredibly time consuming and expensive, which is why the police have to prioritise those few cases where they have a chance of success.
“The legal deterrent appears to be ineffective, so more must be done to prevent scammers from operating, and to do this we must cut the line of communication between the scammers and their victims: search engines and social media.
“The government has a perfect opportunity to bring the regulation into the 21st century by including financial harms within scope of the forthcoming Online Harms Bill. This will mean that, for the first time, search engines and social media platforms will be bound by a statutory duty of care to tackle harm caused as a result of content or activity on their services.
“In doing so, search engines and social media providers will be legally required to remove suspected scammers immediately on notification, and not allow them to operate in the first place, or face sanctions from the new regulator.”
