In one case, two companies – KJK Investments and G Loans – worked together to get investors to take out a loan from G Loans on the condition that they used their existing pension funds to buy shares in KJK. Essentially, investors were essentially borrowing from themselves.
Promised a return of 6% per annum, the scam lured in 209 investors who lost a total of £11.9m.
Meanwhile, the other three companies – Imperial Trustee Services, Omni Trustees and Transeuro Worldwide holdings – persuaded 500 victims to invest £116.5m in storage pods via occupational pension schemes and self-invested personal pension schemes (Sipps).
Rise in cold-calling
The warning coincides with a survey by insurer Old Mutual Wealth which found that more than one in ten people over 50 in the UK have been contacted by pension liberations firms, raising concerns savers are increasingly at risk of scammers.
The study questioned 1,500 Brits aged 50-75 about retirement.
Around 12% of respondents said they had been contacted by pension liberators offering a “free review”, “unlocking”, or “liberation” of their pension.
The majority were contacted through cold-calling, which rose from 56% in 2015 to 68% this year.
According to the report, liberators were offering to divert savings “into other investments with the promise of amazing returns, which often fail to materialise”.