BBC Morning Live financial expert Iona Bain has warned pension holders to stay vigilant, with those born in 1955 or earlier singled out as being at greater risk of a form of pension scam known as “fraud by abuse of position”.
Appearing on the programme alongside presenters Helen Skelton and Gethin Jones, Bain highlighted new figures released by City of London Police, which investigates fraud in the UK. She said millions of pounds collectively are being stolen from older vulnerable people through this type of fraud.
What is fraud by abuse of position?
This occurs when a trusted family member, friend or carer – and in some cases even solicitors – abuses their position of responsibility and authority over someone else’s finances with the aim of stealing money, assets or property.
Bain described the crime as “particularly unpleasant” because it is “committed by someone you know and trust. In some cases, someone you might even love.” She explained that victims may have lost capacity and placed their trust in that person to look after their interests, only for that trust to be used for personal gain.
Older people disproportionately affected
According to Report Fraud, “data shows older people are disproportionately affected. Victims aged 70 and over accounted for more than £51 million in reported losses, while those aged 80 to 89 suffered the highest number of reports and the highest financial losses of any age group, losing almost £24 million”.
In the last financial year, criminals stole £93.8 million through fraud by abuse of position, with nearly half of those losses falling on those aged 70 and above. Bain warned: “Nearly half of those losses have happened to those who are age 70 above. So clearly older people are particularly vulnerable to this.”
Detective Superintendent Oliver Little, from the Lead Force Operations Room at the City of London Police, said: “These offences can have a devastating impact because they are committed by people who have been trusted to act in the victim's best interests. The fact that people aged 70 or over had more than £51 million stolen highlights the significant threat this fraud poses to older and sometimes more vulnerable members of our communities. We want families, carers and those responsible for managing another person's affairs to know the warning signs and report concerns, so we can better protect those at risk.”
‘This issue is not widespread’
Bain said there is no need to panic because cases like this are the “exception”, “not the norm”. She told BBC viewers: “You should be aware of the problem, but not paranoid and not overly worried.”
There were nearly 4,000 reports of fraud by abuse of position in the last financial year, of which about 500 involved a social care worker abusing their position to fraudulently take money. However, Bain noted that over 800,000 adults in the UK receive social care and about one million deliver that social care, saying “it just goes to show this is not widespread and it’s not happening across the board. It’s only happening in a very small minority of cases.”
Regarding power of attorney, Bain said there were 764 reports about misuse of power of attorney in the last financial year, with reported losses of around £35 million. While “a huge figure”, she pointed out that there are 6 to 8 million registered lasting power-of-attorney in place in the UK. She acknowledged possible under-reporting but reassured: “It’s safe to say the majority of people who have this responsibility do not abuse it.”
What to do if you suspect abuse
Bain stressed that having suspicions does not make you a bad person, but before acting you should make sure you have evidence or can at least “identify a pattern of behaviour.” She said it can be much harder to challenge someone you know and trust, so it is important to remember the classic warning signs of fraud.
Questions to consider include: Are large purchases or bank transfers happening that you don’t know about until afterwards? Are you being pressured to keep decisions secret from people you trust? Are you being rushed into making decisions about your finances? Are you being pressured into making decisions?
“All of these are a cause for concern,” Bain said. Host Gethin Jones said people should not be offended, and Bain agreed, adding: “If they've got nothing to hide, they should be willing to share everything.”
