Sick 'pension scam' revealed

AMCHY5 Man Rubbing Eyes angry upset stressed senior adult man male man; 50-60; year; old; 40-50; year; old; people; hand; eye; g
AMCHY5 Man Rubbing Eyes angry upset stressed senior adult man male man; 50-60; year; old; 40-50; year; old; people; hand; eye; g

The Serious Fraud Office (SFO) is investigating a number of companies offering the chance to invest in 'storage pods', saying that they appear to be nothing but a pension liberation scam.

Under the spotlight are the Capita Oak Pension and Henley Retirement Benefit schemes, Self-Invested Personal Pensions (SIPPS) and other storage pod investment schemes.

The investigation also includes the Westminster Pension Scheme and Trafalgar Multi Asset Fund, which invested in other products.

Final salary pensioners being left at mercy of scammers

Capita Oak and Henley Retirement - both of which have now been wound up - offered investors the chance to invest in storage pods which would be rented out, promising returns of up to 12%.

Many people were tempted by cold callers to withdraw cash from secure final salary pensions and put it into these schemes instead.

"Over a thousand individual investors are thought to have been affected by the alleged fraud, including those who invested their pension funds," says the SFO. "The amounts invested total over £120 million."

The facts and figures behind UK investment scams

In fact, there may be many more victims than this, and the SFO is asking for people to come forward if they've invested in one of these schemes in the last six years.

"The SFO investigation into storage pod investment schemes is a timely reminder that unregulated unusual investments at home or aboard come with a high risk that people could lose all their hard-earned pension and other savings," says Kate Smith, head of pensions at Aegon.

"Savers must be on their guard. Promises of high returns or financial inducements are often scams and people falling for this type of investment scam run the risk of their lifetime's savings being lost in a matter of seconds."

Pension scams hit a record £8 million in a month

Since April 2015, under the government's new pension freedoms, it's been made easier to withdraw cash from pension pots and invest it elsewhere - increasing the opportunities for scammers. Tens of millions of pounds have been lost to these schemes since then.

In March alone, according to Retirement Advantage, £8 million was lost to pension scams.

"They know you can now access your savings in new ways and will try to lure you with promises of upfront cash and one-off 'deals' with guaranteed high returns," the Pensions Regulator warns.

Anybody tempted to withdraw their pension and invest it elsewhere should do their homework; the Financial Conduct Authority (FCA) has a list of known pension scammers, here.