Suspect-looking pension transfers could be blocked or paused by a system of ‘flags’ under proposed Department for Work and Pensions (DWP) plans to clamp down on scammers.
Under the proposals, requests could be stopped, for example, if savers have been approached to access or transfer their savings uninvited by social media.
Such unsolicited contact would trigger a flag, which would mean pension trustees or scheme managers could block it.
Red or amber flags would allow pension transfers to be prevented or paused while the saver takes guidance about the possibility of scams.
Flags could also be raised depending on responses to questions such as whether people’s investments are subject to exit penalties or whether they know about charges for their new pension arrangements.
Many scammers are using social media and other online channels to offer people too good to be true…