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Financial scams, and the four signals that give them away

You do not need to recognise every fraud. You need to recognise the shape they all share, and it has not changed in twenty years.

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The short answer

Almost every financial scam shows four signals: they contacted you first, there is time pressure, the return is high and somehow guaranteed, and you are discouraged from checking with anyone. Unsolicited pension cold calls are banned in the UK, so receiving one tells you the caller is already breaking the rules.

4 signalsPresent in almost every scam
BannedUnsolicited UK pension cold calls
5 minutesLong enough to break the pressure
FreeReporting to Report Fraud and the FCA
What is on this page
  1. Every scam has the same shape
  2. The common ones
  3. The same four signals, across four different scams
  4. What to do when contacted
  5. The bank transfer trap
  6. Protecting an older relative

Every scam has the same shape

The products change. The pattern does not. If you learn the pattern, you do not need to recognise the specific fraud.

They contact youCold call, text, email, social media advert or a message in a group. Legitimate firms rarely start a regulated relationship this way.
There is time pressureThe offer closes today. The allocation is limited. Your account will be suspended. Urgency exists to stop you checking.
The return is unusualGuaranteed, high, or somehow not affected by markets. Anything guaranteed and high is a contradiction.
They discourage checkingPressure not to tell family, not to speak to your own adviser, or to keep the opportunity confidential.

The common ones

Pension liberation

Access before the minimum age

An offer to release pension money early. It usually triggers a large tax charge and the pot often disappears entirely.

Clone firm investment

A real name, fake details

The firm name and reference number are genuine. The phone number, website and bank details are the fraudster's.

Recovery fraud

A second bite

Someone contacts a previous victim offering to recover the lost money for a fee. Victim lists get traded.

Authorised push payment

You send the money

You are persuaded to transfer money yourself, often while impersonating your bank's fraud team. That is why it is hard to reverse.

Unregulated investments

Not technically a scam

Storage pods, car parks, overseas land. Often legal, usually illiquid, and outside the Ombudsman and FSCS.

Loan fee fraud

Pay to borrow

An upfront fee for a loan that never arrives. Targets people already under financial pressure.

The same four signals, across four different scams

Scam How they reach you The pressure The promise
Pension liberation Text or social media advert A limited window before the scheme closes Cash from your pension before the minimum age
Clone firm bond Cold call or a search advert The tranche is nearly full A fixed high return, described as secure
Safe account fraud A call appearing to be your bank Your money is at risk right now Your balance protected if you move it
Recovery fraud A call to a previous victim A court deadline they invented Your lost money returned for a fee

Different products, one shape. If you can see the shape you do not need to recognise the specific fraud.

Had an approach you are unsure about?

Send us what they said and we can point you to the FCA Register and warning list.

Ask us a question

Prefer WhatsApp? Message us there. We are open Monday to Saturday, 9am to 8pm.

This goes to a separately authorised firm we have vetted. The introduction costs you nothing. If you go ahead, we may be paid a fee by that firm.

A calculator and notepad being used to work out a household budget

What to do when contacted

1

Stop and take the time

No legitimate opportunity requires a decision today. Ending the call is always allowed.

2

Check the FCA Register yourself

Type register.fca.org.uk in yourself and ring the number it shows.

3

Check the FCA warning list

The warning list names firms the FCA knows are operating without authorisation.

4

Tell one other person

Say it out loud to someone. Scams rely on isolation, and describing it usually exposes it.

5

Report it

Report to Report Fraud, and to the FCA. Reporting helps even when you have lost nothing.

The bank transfer trap

Authorised push payment fraud is where you send the money yourself, believing you are moving it somewhere safe.

The usual script is a call from your bank's fraud team saying your account is compromised and you must move funds to a safe account. No bank ever asks that.

UK banks and payment providers are now required to reimburse victims of bank transfer fraud up to £85,000 in most cases. Do not rely on that as a plan. Reimbursement is slow, conditional and stressful.

A retired client received a call showing her bank's real number on the display. Numbers can be spoofed. She hung up, waited five minutes and rang the number on her card. That five minutes saved £31,000.

Protecting an older relative

  • Register them with the Telephone Preference Service to cut cold calls
  • Agree a family rule: no money moves without a conversation first
  • Ask their bank about extra checks on large transfers
  • Consider a lasting power of attorney before it is needed rather than after
  • Make it clear nobody will be angry if they are targeted, because shame keeps victims silent

A lasting power of attorney is the single most useful document here, and it has to be set up while the person still has capacity.

Post lying on a doormat inside a front door

Who this suits, and who it does not

Be especially careful if
  • You have recently accessed a pension, which puts you on target lists
  • You have been a victim before, because lists get traded
  • You are dealing with anyone who contacted you first
  • The paperwork mentions an overseas scheme or an unusual asset
Reassuring signs
  • The firm appears on the FCA Register with matching contact details
  • They encourage you to take time and check
  • They put the risks in writing before the benefits
  • Payment goes to an account in the firm's own name

Check broadband before you make an offer

Broadband speeds can vary street by street, so check the exact address before you commit. Ofcom's free checker shows which broadband speeds and mobile coverage are available at any UK property.

Check broadband at an address (Ofcom)

Want all your bills in one?

We can introduce you to a specialist who can combine your mobile, broadband and utilities into one bill. There's no fee for the introduction.

We don't provide these services ourselves. Switching household bills is not a regulated financial service, so FCA protections and the Financial Ombudsman do not apply. We'll only pass your details to the specialist if you ask us to. See our privacy notice.

Questions people actually ask

How do I know if a financial offer is a scam?
Look at the pattern rather than the product. Unsolicited contact, time pressure, a return that is both high and guaranteed, and discouragement from checking are the four signals that appear almost every time.
What is a pension liberation scam?
An offer to release pension money before the normal minimum pension age, which is 55 now and rises to 57 on 6 April 2028. It typically triggers a large tax charge and the money often disappears. Genuine early access is limited to ill health and a few protected schemes.
Can I get my money back after a scam?
Sometimes. For bank transfer fraud, UK banks and payment providers must reimburse eligible victims in most cases. For investments through an authorised firm that has failed, the FSCS may pay compensation.
How does a clone firm scam work?
It uses a real authorised firm's name and reference number with different contact details. Ringing the phone number on the FCA Register instead of the one you were given is the defence.
Are cold calls about pensions illegal?
Unsolicited pension cold calls are banned in the UK. If you receive one, that alone tells you the caller is breaking the rules.
Where do I report a scam?
Report Fraud for the crime, the FCA for an unauthorised firm, and your bank immediately if money has moved. Report even if nothing was lost, because it helps protect others.
What is recovery fraud?
A second scam aimed at previous victims, offering to recover lost money for an upfront fee. Victim details are traded, which is why a second approach often follows the first.
Is an unregulated investment always a scam?
No, but it sits outside the protections. There is usually no access to the Financial Ombudsman Service and no FSCS cover, so a loss is a loss.
How do I check broadband speed at a property?
Use Ofcom's free broadband and mobile checker at checker.ofcom.org.uk. Enter the property's postcode and choose the address to see which broadband speeds and mobile coverage are available before you make an offer.

Where to go next

Check an adviserThe two-minute check.Spot a pension scamThe pension-specific version.Financial advice explainedAdvice, guidance and permissions.Is my money safe?What the FSCS actually covers.Wills and power of attorneyProtecting an older relative.Find a lost pensionFree, and never through a cold caller.
Where these figures come from

Figures checked on 1 September 2026 and correct for the 2026/27 tax year. Rates change, so check the source before you act on a number.

Investment and pension advice goes to a separately authorised firm we have vetted. The introduction costs you nothing. If you go ahead, we may be paid a fee by that firm.

Last reviewed September 2026.

If something feels wrong, ask before you act

Start a conversation

Prefer WhatsApp? Message us there. We are open Monday to Saturday, 9am to 8pm.

This goes to a separately authorised firm we have vetted. The introduction costs you nothing. If you go ahead, we may be paid a fee by that firm.