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Regulators need coordinated approach to pension scams

The Institute and Faculty of Actuaries (IFoA) has called on The Pensions Regulator (tPR) and the Financial Conduct Authority (FCA) to address the way they identify and prevent scams in order to support public confidence in the pensions industry. That comes in the IFoA’s response to the consultation from tPR and FCA on ‘Regulating the pensions and retirement income sector’.

Currently, following litigation in the UK High Court, the legal position requires trustees to execute pension transfers where a statutory right to a transfer exists, even if that transfer request is suspected to be a scam by the trustees or the FCA. tPR and FCA should investigate fraudulent activity while cases are live rather than retrospectively to more effectively improve protection for consumers.

Colin Wilson, IFoA Immediate Past President said:

“The current system is intended to act in the interests of the consumer, but it is slow and unwieldy with the two regulators' approaches being at odds. We would like to see tPR and FCA addressing this discrepancy and taking a joint approach. Specifically, tPR could provide greater clarity around the parameters for trustees wishing to delay transfers where potential fraudulent activity is being investigated. It’s crucial that consumers believe their hard-earned pensions savings are safe and being well looked after by trustees with proper oversight from the regulator.”

The IFoA also wants to see tPR and FCA help the public to better understand the value of saving for retirement to ensure individuals have enough income when they stop working. The regulators should make a more concerted effort to give consumers the confidence to view all pensions saving as good, starting as soon as you can and saving as much as you can.

Colin Wilson continued:

“Consumers are currently having to navigate some big changes in the pensions sector. The greatest of these is the ongoing decline in the provision of generous defined benefit (DB) pensions and the subsequent shift to defined contribution (DC) pensions. Whilst automatic enrolment has been a great success thus far in getting more people to save, it’s unlikely that current savings levels will be able to match the kind of income in retirement that DB pensions would have afforded.

“Trying to understand whether your retirement pot will be sufficient when the time comes can be complex and challenging. tPR and the FCA have a key role to play in helping to improve the public perception of good financial advice and/or guidance, not just at retirement but at key points throughout the customer journey, in order to boost confidence in the round.”


Sonia Sequeira, Media Relations Manager
Tel: 07525 592 198

Notes to Editors

Institute and Faculty of Actuaries’ response to the consultation from tPR and FCA on ‘Regulating the pensions and retirement income sector’.

About the Institute and Faculty of Actuaries

The Institute and Faculty of Actuaries (IFoA) is a royal chartered, not-for-profit, professional body.

Research undertaken by the IFoA is not commercial.  As a learned society, research helps us to fulfil our royal charter requirements to further actuarial science and serve the public interest. 

Actuaries provide commercial, financial and prudential advice on the management of a business’s assets and liabilities, especially where long term management and planning are critical to the success of any business venture. They also advise individuals, and advise on social and public interest issues.

Members of the IFoA have a statutory role in the supervision of pension funds and life insurance companies. They also have a statutory role to provide actuarial opinions for managing agents at Lloyd’s.

Members are governed by the Institute and Faculty of Actuaries. A rigorous examination system is supported by a programme of continuing professional development and a professional code of conduct supports high standards reflecting the significant role of actuaries in society.

The IFoA is available to provide independent expert comment to the media on a range of actuarial-related issues, including enterprise risk management, finance and investment, general insurance, health and care, life assurance, mortality, and pensions.


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