Fraud losses in the period following the introduction of pension freedoms could be a quarter higher than initial estimates.
That was the calculation by AJ Bell using City of London Police data, having obtained updated statistics. This revealed the figure had been revised up to £13.3m – 25% higher than the original estimate. The reason given for the new, higher figure is that victims often update their reports to reflect the full amounts lost.
Previously, it was thought some £10.6m of pension fraud losses had been reported to City of London Police in the six months following the introduction of the pension freedoms in April 2015.
It means the year-on-year spike in fraud reports was actually 146%, from £5.4m in the corresponding period in 2014.
The revision means the total pension fraud losses recorded by City of London Police has passed the £40m mark since it started tracking the data in May 2013.
AJ Bell senior analyst Tom Selby said: “Judging by this data, the post-freedoms pension fraud spike was worse than we had previously feared, and yet the Government continues to sit on its hands when it comes to taking meaningful action to deter scammers.
“A broad coalition of observers, from former pensions minister Baroness Ros Altmann to advisers and providers, agree banning cold calling could make a real difference in the fight against pension fraud.”
A petition calling for the Government to ban pensions cold calling as part of a wider drive to clamp down on pension fraud has so far attracted almost 2,000 signatures.
Mr Selby said: “More than £40m of pension fraud losses have been reported to City of London Police since May 2013, while estimates of total losses UK-wide from pension-related fraud – including investments – run into the hundreds of millions. This does untold damage to both the victims whose long-term savings are decimated, and to the reputation of pensions as a whole.
“Prime Minister Theresa May has indicated an appetite for intervention in various markets – she should start by strengthening the Government’s response to the threat of pension scams.”