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Since the introduction of pension freedoms and flexibilities the industry has seen a marked increase in the prevalence of pension scams. Stories about such scams continue to make regular headlines, and no longer just in the pensions press, instead we see them in our daily and Sunday papers, on our radios and even making it to primetime television with an edition of BBC’s Panorama dedicated to the issue.
In response to concerns from our clients about this increase in pension scam risk for members transferring their pensions, Xafinity set-up their unique Pension Scam Identification Team. We had identified that a significant weakness in existing scam detection processes was the reliance on reviewing paperwork to spot “tell-tale” signs of scam activity. In many cases the scammer will offer to complete such transfer paperwork on behalf of the member, ensuring that nothing untoward is spotted in it and hence that the transfer is paid by the scheme.
Xafinity’s Pension Scam Identification Team provides an extra level of protection to members from scams by way of a telephone call with the member wishing to transfer. This call allows the member to be asked about the circumstances surrounding his decision to transfer and gives the trustees confidence that the answers received are those of the member themselves, not those of the scammer deliberately trying to hide any scam activity.
The service is now being used by over 100 pension schemes and is successfully detecting potential scam cases that would otherwise have been missed by just a paperwork review. It has been well received by members who have appreciated the additional steps being taken by their trustees to protect them from scams.