Protect your redundancy pay from scams.

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Given the many recent redundancies announced, it is inevitable that as coronavirus continues, more redundancies are likely.

Scammers often see turbulent times like these as an opportunity. Unfortunately, people that receive a lump sum of money through redundancy pay can be particularly vulnerable to being targeted. For example, the BBC reported on a case where fraudsters had taken £25,000 from a doctor’s redundancy payment and pension savings, and Surrey Police has issued a warning about investment fraud after a woman looking to invest her redundancy payment was scammed out of £275,000.

WEALTH at work, has highlighted the common things people say when explaining why they fell for a scam to hopefully help people to avoid losing their redundancy pay to fraudsters;

1. “They looked so professional” – Scams look and sound legitimate, which is why people are hoodwinked. They often have very professional looking websites and literature that can make it hard to distinguish from the real thing.

2. “It was a once in a lifetime opportunity” If an investment offers the opportunity of a lifetime, individuals should be very suspicious. If it seems too good to be true, it probably is.

3. “They seemed so friendly and knew so much about me” –The people that run scams are clever and may have been able to get hold of an individual’s personal details. Individuals should be aware to not let their knowledge and friendliness catch them off guard.

4. “If I didn’t decide quickly the opportunity would be lost” – Genuine advisers will never rush individuals to make a decision. Anything that talks about limited time offers is likely to be a scam.

5. “They said they could help me to access my pension early” – When made redundant, some individuals may want to access their pension savings. Pensions can normally only be accessed after the age of 55, unless in cases of seriously ill health. In normal circumstances, if someone promises to release a pension early they are lying and it is a scam.

6. “I didn’t know how to check them out” – Whatever individuals are planning to do with their redundancy money, they should check that the company is registered with the Financial Conduct Authority (FCA), as if they’re not, it’s probably a scam. The FCA’s financial register can be found here.

7. “They kept contacting me and eventually I just gave in” – Scammers will use technology and try to contact individuals through various means such as social media, texts, telephone calls and emails. If individuals are in doubt, they should ignore it and hang up the phone or delete the message. Phone companies should be able to help by blocking any offending numbers and email providers can help to block emails from specific senders. Individuals should be aware of what they share through social media and check that their privacy settings are as secure as possible.

8. “I didn’t report the scam straight away” – If individuals think that they are being scammed, they must report it on the FCAs Scam Smart website and to Action Fraud. Not only may they be able to help them, but they will be able to help others from falling for the same scam.

Jonathan Watts-Lay, Director, WEALTH at work, comments; “While redundancy can be a really stressful time, a difficult situation can be made worse by unscrupulous fraudsters who won’t think twice about scamming people out of their redundancy pay.”

He adds; “This money is a lifeline for many and it is crucial that people are protected from making disastrous mistakes when they are most vulnerable.”

Watts-Lay concludes; “Many employers offer financial education, guidance and regulated financial advice to help people make the most of their redundancy pay. Speak to your employer to find out what help is available.”

The latest news is brought to you by WEALTH at work, a leading financial wellbeing and retirement specialist. WEALTH at work and my wealth are trading names of Wealth at Work Limited which is a member of the Wealth at Work group of companies.

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