WARNING - 'If it’s too good to be true......'
Posted by siteadmin on Wednesday 3rd August 2016.
Many will recall the publicity surrounding the Government changes to the way people over 55 could access their pensions back in April 2015.
The so called Pensions Freedom Act meant that people over this age could get access to their pension pots where as George Osborne, the then Chancellor of Exchequer said 'Pensioners will have complete freedom to draw down as much or as little of their pension pot as they want, anytime they want'.
But this liberating move also set free darker forces intent on hoodwinking people out of their hard earned money.
When the changes were first introduced, there was a lot of publicity warning people about unscrupulous operators who might want to pull the wool over their eyes.
This publicity slowly eased and I’ve noticed that some people have been dropping their guard since.
I watched an interesting Panorama documentary on the BBC recently about a company offering ‘free pension reviews’ which were shown up to be nothing but a vehicle to channel funds into a property group. The key point being that both were within the same group of companies, with the principle company building resorts in Cape Verde.
Under the guise of a ‘free review’ the company were being unscrupulous by trying to get people (and succeeding) to put chunks of their pension pots into the scheme to fund property developments.
As the undercover reporter was told by one of the company’s representatives ‘we’re aiming to get people’s money so we can redirect it to building hotels in Cape Verde’.
Not only was their advice flawed (where to give advice everyone needs to be authorised by the Financial Conduct Authority where this individual wasn’t), but putting the bulk of your money into one basket as it were, is a very risky strategy.
Just last week Channel 4 aired a Dispatches programme, also highlighting some dubious companies targeting people’s pension pots. Often with enticing offers of returns that far dwarfed what’s available at the moment.
Without getting too complicated it all boils down to this. If you are approached by someone promising returns on your investments that seem too good to be true, the chances are that they probably are. Simple.
If you are in any doubt whatsoever, check the FCA register first. And even if they are authorised, quiz them heavily.
So my guidance is that as a rule of thumb, it’s probably best to give cold calls the cold shoulder.