Pensions Ombudsman Anthony Arter has raised concerns about the increase in pension scam activity during the coronavirus pandemic in a virtual meeting with the Work and Pensions Committee (WPC).
Arter - who is also the Pension Protection Fund Ombudsman - appeared before the WPC yesterday (8 July) as part of its regular scrutiny of public organisations accountable to parliament.
The session considered the priorities and challenges likely to face Arter in the coming year, including a potential increased caseload from scam victims in the wake of Covid-19.
A total of £5.1m worth of losses to fraud were reported across the UK between February and June, according to ActionFraud, including more than 11,000 coronavirus-themed scams with the most common of which were pensions-related.
Arter told the committee he had met with a range of other ombudsmen recently to discuss the management of new cases related to the scams.
"Public sector ombudsmen will be inundated with work after Covid-19 and pensions will be no exception to that," he said. "If you look at the financial strain people are going to be suffering going forward, and they have a pot of money in their pension scheme, the big concern is the fraudsters coming in to say ‘we can help you get that money'".
He added people under 55 on the retirement glidepath were most likely to be at risk.
"Fraudsters will be telling them they can help them get that money, which they can't, but I can see it happening and I can see an increase already," he continued. "It's always delayed action, however, and we may not see those complaints coming through for another 12 months yet."
Royal London pensions specialist Helen Morrissey said Arter's concerns were likely well-placed.
"[Arter] is right to be worried," she said. "Scammers are known to work at lightning speed and evolve their methods to exploit people's fears. They may well take advantage of people's concerns about a drop in their pension value or a potential loss of income to try and separate people from their pensions."
Arter also flagged auto-enrolment (AE) levels to the WPC in response to a question on particular areas within pensions that could be most effected in the Covid-19 recovery economy.
He said: "I think a lot of small organisations will turn round to their employees and try and encourage them to opt out of AE.
"There will also be the employers that will take those pension contributions from smaller organisations - and I have already seen this happening - and where they are so hard it because of Covid-19, and not pay them into pension schemes.
"I am convinced more of this will happen, so undoubtedly there will be an increase in the number of complaints because of the virus."
Arter, who has been the ombudsman since Mar 2015, will finish his tenure at The Pensions Ombudsman next year.
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£5m lost to fraud between February and June