FCA launches new tool for pension savers as 800,000 report losing money to scams | Personal Finance | Finance
The Financial Conduct Authority (FCA) has launched a “firm checker” tool to protect people from falling prey to fraudsters. The FCA revealed that approximately 800,000 people reported losses due to investment or pension-related scams in the year leading up to May 2024.
The tool, accessible on the FCA’s website, enables users to verify whether a firm is authorised and holds the necessary permissions to provide services, significantly reducing the risk of becoming a victim of fraud. The regulator advises people to not only check a financial services firm’s authorisation for the services they offer, but also ensure that the contact details align with those listed on the FCA firm checker. It highlighted that bank transfer scams, unauthorised consumer investments, and pension-related fraud often originate from social media, texts, and phone calls.
Sheree Howard, executive director of authorisations at the FCA, said: “Ruthless fraudsters are constantly evolving their tactics so they can steal money from innocent victims.”
She urged the public to use the firm checker when considering any financial service, be it an investment, pension opportunity, loan, or other, to help combat financial crime.
The FCA research shows approximately three-quarters of adults consistently decline or disregard unsolicited communications regarding investment or pension schemes, whether by phone, email or text.
The watchdog confirmed that the Financial Services Register will continue operating as the full regulatory database for authorised financial services.
On Monday, the FCA outlined reforms designed to boost consumer investment access and enable informed risk-taking, potentially moving away from the standard “your capital is at risk” warnings across all products.
The regulator is putting forward fresh regulations for investment product information, whilst establishing clearer distinctions between retail and professional investors who may fall outside retail regulatory requirements. These measures form part of broader initiatives to steer investors beyond simply holding cash deposits.
The proposals also support the Government’s objective of fostering a retail investment culture across the UK.
The Government revealed in the Budget that the annual adult Cash ISA contribution limit will drop to £12,000 from April 2027.
The yearly total limit for adult ISA contributions will stay at £20,000, potentially prompting savers who hit the £12,000 cash ISA threshold to allocate additional funds to equities and shares.
Those aged over 65 will maintain their complete £20,000 annual cash ISA entitlement. HM Revenue and Customs (HMRC) has also outlined new regulations to prevent individuals from circumventing the new limit.
These include levies on interest earned on cash stored in stocks and shares ISAs, as well as assessments to ascertain if money is being kept in “cash-like” accounts.
Pat Hurley, Ombudsman Director at the Financial Ombudsman Service (FOS), said: “Being the victim of a fraud or scam can be deeply distressing, and sadly for many people the financial implications can be life changing. The Financial Ombudsman Service continues to receive hundreds of cases a week from people who have been victims of fraud and scams.
“If asked to transfer money to a financial services provider – particularly if investment or pensions related – check the firm is authorised using the FCA firm checker and consider seeking independent financial advice.”
Mr Hurley added: “The Financial Ombudsman Service is free for consumers and, if you think you have been treated unfairly by your bank, you should complain to the business first and then get in contact with our service, and we’ll see if we can help.”
