Small Business Owners: Don’t Let Scammers Steal Your Pension

Saving for retirement is a priority for many small business owners, as they don't have access to employer-sponsored pension plans. Whether you're contributing to a 401(k), an IRA, a superannuation fund, or a private pension, your hard-earned savings could be at risk.

Scammers know that many entrepreneurs manage both their business and personal finances from the same devices and accounts. This makes small business owners an attractive target—if scammers gain access to a business system, email, or banking details, they can often reach everything at once, including retirement savings. But they can also target retirement savings by using fake investment opportunities, phishing emails, and fraudulent pension withdrawal offers. Falling for these scams doesn't just hurt your business—it can also put your personal financial security and future retirement at serious risk.

This guide will help you understand how retirement savings scams work, the red flags to watch out for, and how to protect yourself from financial fraud.

Retirement Savings Scams That Target Small Business Owners

Scammers often impersonate financial institutions, tax offices, or pension providers to trick small business owners into transferring money, revealing sensitive details, or making fraudulent investments. These scams can lead to stolen savings, identity theft, and serious financial consequences. Here are some of the most common scams targeting retirement savings.

Fake Pension Advisors

Fraudsters pose as financial advisors offering exclusive investment deals or pension transfer services. They often promise high returns or claim they can help small business owners access their retirement savings early without penalties, which is usually illegal. These scammers may charge high fees for fake services or gain access to an account and steal the entire pension fund. Because they appear knowledgeable and professional, their victims often don't realize they've been scammed until it's too late.

Phishing Emails from Fake Government Pension Agencies

Scammers send emails or make phone calls pretending to be from tax offices or pension providers, claiming the recipient must update their account details or verify their retirement savings. Clicking on the provided links can lead to identity theft, unauthorized access to pension accounts, or malware infections that compromise business systems.

Investment Fraud and Ponzi Schemes

Some scammers promote exclusive investment opportunities with guaranteed high returns. These are often Ponzi schemes, where money from new investors is used to pay fake profits to earlier victims, creating the illusion of a successful investment. The scheme eventually collapses when there aren't enough new investors to sustain it, and the fraudsters vanish with the money.

Fake Withdrawal Offers

Scammers claim they can help business owners access their pension funds early without penalties. They often request an upfront fee or persuade victims to transfer their savings into a fraudulent account. Once the money is sent, it disappears, leaving the victim without their retirement savings.

Payroll Fraud Targeting Pension Contributions

Cybercriminals can infiltrate business email systems or payroll software to alter bank details, redirecting pension contributions to fraudulent accounts. This type of fraud often goes unnoticed until employees or business owners discover that payments are missing from their pension accounts. Since small business owners often manage both business and personal finances from the same place, a single breach can expose all financial assets, including retirement savings.

How to Spot a Retirement Scam

Scammers use emails, phone calls, and social media ads to trick people into giving up their retirement savings. They rely on deception and urgency, pressuring their targets to act fast before thinking things through. Knowing the warning signs can help you avoid becoming a victim.

- Unusual payment or transfer requests. You might receive an email, phone call, or message asking you to change the payment details for pension contributions or retirement savings transfers. The request may seem to come from a legitimate institution, but scammers often manipulate email addresses or pose as financial representatives to trick their victims.

- High-pressure tactics and urgent demands. Scammers claim you must act immediately to avoid legal trouble, penalties, or missed investment opportunities. They may insist that delaying action will result in losing access to your retirement funds or missing out on an exclusive high-return investment.

- Advertisements offering early pension access or exclusive investments. These promotions claim to provide ways to unlock retirement savings early or "take control" of pension funds. Scammers may promise quick access to your funds before you're eligible or guarantee unrealistically high returns. Many victims are persuaded to transfer their pension into a fake self-managed fund, which the scammer then drains.

- Encouragement to open a self-managed pension fund is another tactic used to steal retirement savings. Scammers claim to assist business owners in establishing and managing their own pension funds, suggesting this will provide them with greater control over their finances. They may present fake investment tracking applications or reports to give the impression that the funds are increasing. Over time, they withdraw the money, ultimately leaving victims with nothing.

- Emails or calls requesting login credentials or verification codes should always be treated with suspicion. Scammers may claim they need access to your pension account, online banking, or payroll software to complete a transaction or secure your funds. In reality, once they have your login details, they can transfer your retirement savings to an account they control, wiping out your funds.

How to Protect Your Business from Retirement Savings Scams

Verify Before Making Payments or Transfers

If you receive an unexpected request related to your pension contributions, always verify it with your financial institution or pension provider using a known contact method. Do not rely on phone numbers or email addresses provided in the message, as they may be fake. Contact the institution directly through its official website or customer service channels.

Secure Your Payroll and Financial Accounts

Many scammers gain access to pension funds by compromising payroll systems or financial accounts. To prevent this, use strong passwords and multi-factor authentication (MFA) for all payroll, banking, and pension-related accounts. Limit access to financial information to only trusted employees, and regularly update your payroll software to fix security vulnerabilities.

Monitor Your Pension Account Regularly

Checking your retirement savings account frequently can help you spot unusual activity before it becomes a serious problem. Log in through your pension provider's official website and look for unexpected transfers, changes to personal details, or any requests you did not authorize. If something doesn't look right, report it immediately to your pension provider or financial institution.

Educate Yourself and Your Employees on Scams

If you handle payroll or financial transactions, learning how to recognize retirement savings scams is essential. Train employees to be cautious when receiving unexpected pension-related requests. Encourage a "verify-first" approach before making any payments or sharing sensitive details.

Use Strong Security Measures to Prevent Identity Theft

Identity theft is a common tactic used in retirement savings scams. Scammers steal personal information to open fraudulent pension accounts, transfer funds, or gain access to payroll systems. If your pension provider offers additional security measures like multi-factor authentication, enable them to add an extra layer of protection.

Be Cautious of Investment or Pension Offers That Seem Too Good to Be True

Many scams involve promises of early pension access, high-return investments, or self-managed pension funds that give you "full control" over your retirement savings. If you are approached with such an offer, take time to research it thoroughly. Scammers may create fake investment performance reports, provide misleading financial projections, or claim they can help you avoid legal restrictions on pension withdrawals. If an investment opportunity seems too good to be true, it probably is. Always check if the financial advisor or institution is properly licensed before making any decisions.

Report Suspicious Activity

If you suspect a scam, report it to your pension provider, tax office, or financial institution. You can also warn employees and business partners about potential scams to help prevent further attacks. Fraudsters often target multiple businesses using similar tactics, so spreading awareness can protect others from falling victim.

Bitdefender Ultimate Small Business Security helps protect small business owners by blocking scam attempts before they reach you. With Scam Copilot, you can detect fraudulent messages in real-time, while phishing and email protection prevents fake pension-related emails from slipping into your inbox.

Additionally, Digital Identity Monitoring alerts you if your financial or personal details have been leaked, allowing you to take action before scammers can use them.

Check out our plans for small businesses.