Pension Scams via Bank Transfer
Fraudulent pension advisers use domestic bank transfers to move retirement funds into worthless or fictitious schemes, exploiting authorised push payment systems to collect retirement savings.
Part of: Pension Scams
Last reviewed: 1 June 2026
Domestic bank transfers used in pension scams occupy a regulatory grey area: the transfer is authorised by the account holder, making it harder for banks to intervene. Unlike credit card transactions, bank transfers carry no automatic chargeback mechanism, and the funds often pass through mule accounts that complicate tracing.
In the UK, authorised push payment fraud is the mechanism behind most pension bank transfer scams. The victim authorises the transfer in good faith, believing it to be a legitimate pension scheme switch — but the receiving 'scheme' is fraudulent or insolvent.
How this scam works on bank transfer
A victim is cold-called or responds to a social media advert for a specialist pension advisory firm. After an initial consultation, they are presented with a portfolio of alternative investments — storage units, green energy projects, overseas property — into which their pension will be moved for superior returns. A series of domestic bank transfers move the funds from the victim's SIPP to the fraudulent investment vehicle.
In simpler variants, the 'adviser' claims to have identified an HMRC-related pension debt that must be paid from the pension pot to avoid penalties. The victim authorises a bank transfer to what they believe is HMRC but which is the scammer's account.
Once funds are in the fraudulent vehicle, annual 'statements' may be provided for a period to maintain the illusion before the scheme winds up, the adviser disappears, and the victim discovers the investment is worthless.
Common red flags
- Alternative investments promising high fixed returns are presented as superior to mainstream pensions
- Adviser rushes to complete bank transfers before you can conduct independent due diligence
- Receiving account is not a recognisable regulated pension scheme or trustee
- HMRC 'debt' that requires immediate bank transfer from your pension is cited
- Adviser is reluctant to be verified against the FCA or equivalent regulator's register
- Investment descriptions involve illiquid or exotic assets in overseas jurisdictions
How to protect yourself
- Before authorising any pension bank transfer, verify the receiving scheme on your regulator's list of approved pension schemes
- Take at least 30 days for independent due diligence before any pension transfer regardless of claimed urgency
- Engage a free independent financial guidance service before moving pension funds
- Your existing pension provider must legally flag suspicious transfer requests — heed any warnings they issue
- Report any adviser who pressures you to transfer quickly or who cannot be independently verified
- Understand that losing pension savings often cannot be compensated by the Financial Services Compensation Scheme if the investment vehicle falls outside its scope
How to report it
- Report to the FCA at fca.org.uk/consumers/report-scam or your national financial regulator
- File a report with Action Fraud or your national cybercrime authority
- Report to your pension provider and the Pensions Regulator at thepensionsregulator.gov.uk
Frequently asked questions
Can I get pension funds back if the transfer was authorised?
Recovery is difficult because the transfer was authorised. However, in the UK, the Financial Ombudsman Service and some banks have provided redress in cases of authorised push payment fraud. The Pension Protection Fund does not cover fraudulent schemes. Report immediately — early action improves any recovery chance.