When it comes to keeping precious things safe, there’s a multitude of steps we can take to deter thieves. For cars, houses and jewellery we can choose from a variety of locks, cameras and alarms, even safes. There are so many options to keep material items safe, not only because they mean so much to us, but also because they are tangible. Yet for many people, apart from their home, most material things are not worth nearly as much as their pension. But unfortunately, most of us don’t think about things in those terms.
Ironically, we spend far more time trying to keep our material things safe when far more is at stake if we are a victim of pension theft than a burglary. The main reason for this, I think, is because the word pension does not convey the same sense of urgency as protecting a diamond ring for example, because it holds such little emotional attachment. What happens though, if we exchange the word pension for a different word - retirement? This conveys something altogether very different. Suddenly we see not just maintaining a certain standard of living, on a basic level providing a home and food, but also hopes and dreams and some relaxation in a faraway place….hopefully. Would you rather give a thief your car, or your retirement? Put it that way, and people may be more inclined to go out of their way to protect themselves better.
Sadly, even though there has been much work and progress made both in terms of awareness and putting safeguards in place, the prospect of a thief ‘stealing’ our retirement remains very real. Scams continue to be on the increase and have the potential to ruin lives. As an industry we must do whatever we can to prevent this from happening – it must be done collectively with trustees and schemes, but vitally in partnership with members. We need to help educate members about the dangers of pension scams, what to look out for and how to avoid falling into the trap – campaigns such as Scams Awareness which present a united front to consumers are vital.
One of the most challenging aspects of pension scams is that the threat is constantly changing, as scammers evolve their techniques and become more sophisticated. How do trustees stay one step ahead to ensure their members’ retirements are protected? The Pensions Scams Industry Group (PSIG) recently published Version 2.1 of Combating Pensions Scams – A Code of Good Practice to assist trustees. Supported by the Minister of Pensions and Financial Inclusion, Guy Opperman, the code continues to develop to reflect the ever-changing issue of pension scams.
While it will take the introduction of legislation to truly end the growing problem of pension scams, in the meantime, our code provides essential guidance and tools to help trustees and providers identify, and protect, their members and themselves from suspicious activity. It is important for members to not only protect themselves from the threat of scams, but to understand that the industry will support them in this fight. We urge trustees to:
- Read the code – This is essential. Don’t just know it is there. Read it, understand it, learn from it and act on it.
- Review and update any due diligence process to reflect the new code.
- Ensure that you are on top of the developments – read the industry press – talk to the industry bodies – speak to peers - scammers are increasingly sophisticated, we need to work collaboratively to stop them.
- Embrace campaigns such as Scams Awareness - build the messages into employee communications, shout them from the rooftops.
- Speak to your members – encourage a two way conversation so that you have a grip on what their understanding is of pension scams and where knowledge gaps need to be filled.