People over 55 have reported an increase in cold calls from unregulated investment firms since the introduction of pension freedoms last year, according to research conducted by the Financial Conduct Authority (FCA).
As part of its anti-scam work, the regulator asked 2,301 people over 55 about their experience with cold callers and unregulated investment firms.
It found that over the last year, 32% of those they asked had seen a sharp rise in the volume of unsolicited calls offering them investments over the last year. People who were contacted by these firms saw a 40% increase in unsolicited calls.
The research raises concerns about how potential scammers are targeting people’s pension savings following the introduction of pension freedoms last April.
Earlier this year charity Citizens Advice warned advisers to avoid using so-called introducer firms which make unsolicited calls.
In February, the FCA told New Model Adviser® it was ‘looking into the activities of unauthorised pension introducer firms’ after concerns were raised about how these firms contacted potential clients.
According to the FCA 47% of those who have experienced investment fraud were first contacted by cold callers.
The study published today by the FCA said over 55s are looking to invest in less mainstream investment products due to low interest rates, and 27% of over 55s falling victim to investment fraud were scammed via an unauthorised firm selling unregulated products such as wine, diamonds and land.
Only half of those investing in unregulated products through unauthorised firms sought professional advice or checked investor information such as the FCA’s warning list.
'If you are contacted out of the blue about an investment opportunity that sounds too good to be true then it probably is,’ FCA director of enforcement Mark Steward said. ‘We would urge you to be sceptical.’
Over 65s with savings in excess of £10,000 were found to be a particularly at risk group, as they were three and a half times as likely to fall victim to investment fraud compared with the wider population.