First Actuarial’s pledge to combat pension scams

In 2020, TPR asked trustees, providers and administrators to pledge to do all they can to protect scheme members and follow the principles of the Pension Scams Industry Group (PSIG) Code of Good Practice. First Actuarial has signed up to this pledge as part of our commitment to stopping scammers in their tracks.

In the world of pensions, we’ve seen an increase in the number of scammers looking to take advantage of scheme members and their hard-earned pension savings.

As scheme administrators, First Actuarial is in the front line of the fight against pension scams. We can give trustees every reassurance that we’re taking this problem very seriously. We’re committed to doing all we can to protect members’ savings.

We have given our full support in recent years to initiatives promoted by The Pensions Regulator (TPR) and the Financial Conduct Authority (FCA) that attempt to eradicate pension scams.

In 2020, TPR asked trustees, providers and administrators to pledge to do all they can to protect scheme members and follow the principles of the Pension Scams Industry Group (PSIG) Code of Good Practice. First Actuarial has signed up to this pledge as part of our commitment to stopping scammers in their tracks.

We make sure our administrators comply with this pledge along with all legislative requirements and industry-wide guidance. And we give them the training they need to spot scams and help combat this ugly side of pensions.

Our anti-scam measures include robust processes in the following areas.

Communicating the risks of scams to members

Our transfer value documentation meets the requirements set out in TPR’s pledge to warn members about pension scams on a regular basis. The steps we take include:

  • Enclosing a copy of the Be ScamSmart leaflet, jointly published by the FCA and TPR, with all transfer value quotations that we issue
  • Enclosing a copy of a letter on pension scams jointly prepared by TPR, the FCA and the Money and Pensions Service
  • Encouraging members to get impartial guidance from Pension Wise
  • Highlighting the different forms pension scams may take
  • Providing members with links to websites where they can find out more about pension scams.

Due diligence on pension transfers

We carry out appropriate due diligence with thorough checks on pension transfers. We then document those checks. The steps we take include:

  • Making sure that members have obtained appropriate independent financial advice where the unreduced value of their benefits exceeds £30,000
  • Checking that all advisers are authorised to provide advice on transfers, by making sure the details provided match those on the FCA register and that the firm involved is not a clone firm
  • Carrying out due diligence on all transfers, and following the process set out in the PSIG Code of Good Practice where further due diligence is required
  • Raising any concerns we have about a transfer with our technical team for review and guidance
  • Informing clients if we suspect a transfer request may be a pension scam.

Training and keeping our knowledge up to date

Our technical team analyses all pensions legislation and guidance. They provide regular training to our scheme administrators. This includes any updates to guidance and relevant codes on pension scams from the regulators.

A number of our employees also attend industry seminars on pension scams run by bodies such as the Pensions Administration Standards Association (PASA) and the Pensions Management Institute (PMI).

Embedding scam awareness in all documentation

There are three key areas of communication warning members about scams covered in the pledge and we are embedding these in our communications.

Annual benefit statements
We recommend that schemes that issue annual benefit statements include links to the ScamSmart section of the FCA website and include a copy of ScamSmart leaflet.

Transfer value documents
As stated above, we give full warnings of scams in all our transfer value documentation.

Client websites
Where members have access to a scheme website or portal, we recommend that it displays warnings about pension scams.

First Actuarial’s commitment

First Actuarial is committed to protecting members from scammers and will continue to look at ways to help members understand the risks out there and what they need to consider when approached by these predators.

Any questions or comments about this article?

Get in touch with the author, Robert Wakefield.

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