The regulations introduce a system of red and amber flags, giving pensions trustees the power to refuse transfers where there is a high risk they may be part of a scam.

The new powers arise from the Pension Schemes Act 2021.

The regulations and guidance were drafted by the Department for Work and Pensions (DWP), TPR, the Money and Pensions Service (MAPS) and the Pension Scams Industry Group (PSIG).

PSIG estimates 5% of all transfer requests give trustees and scheme managers cause for concern.

The new regulations mean:

• Stronger transfer checks: Trustees are required to undertake checks before making a transfer 

• Trustees and providers can maintain a 'clean list' of personal pension schemes they have reason to believe are not being used for scams 

• A pledge to combat pensions scams using six ‘saver-protecting’ actions, including giving scheme members warnings of high-risk transfers and instigating enhanced due diligence

Nicola Parish, TPR's executive director of frontline regulation, said: “We welcome these new regulations which further empower trustees to act as the first line of defence against scammers.

“We are pleased these new rules enshrine in legislation two of the key parts of the pledge to combat pension scams – around due diligence measures and issuing members warnings of high-risk transfers.

“We urge all trustees and pension providers to take note of these new rules and continue to play their part in stopping scams. This includes reporting all suspected scams to Action Fraud, or by calling 101 in Scotland.

"The pension industry can continue to demonstrate its commitment to stopping the scourge of scammers by joining our pledge campaign.”

Margaret Snowdon, chair of PSIG, said: “PSIG welcomes TPR's new guidance for trustees on changes to transfer regulations.

“We were pleased to work closely with TPR and DWP to deliver the changes we called for and we now urge the industry to apply the new conditions for the statutory right to transfer in order to safeguard members' benefits.

“Schemes that already carry out due diligence checks and maintain clean lists of transfers destinations should be well prepared for the new rules and the majority of transfers should proceed without delay – the purpose of the changes is to allow trustees to say no when faced with scam signs.

“PSIG is working on a revised version of its Scams Code, which we will publish later in the year, to give practical help on how to use the new rules.”

• The new guidance is available here: Pension Transfer Guidance for trustees from TPR