Government to ban pension cold calling

Under the new plans, all calls where a business does not have an existing relationship will be banned, and firms breaching the ban will face fines of up to £500,000.

The ban will also apply to those who have inadvertently opted in to receiving third party communications.

The government estimates that approximately 250 million scam calls are made each year, with around £19m lost to pension fraud between April 2015 and March 2016.

Tom McPhail, head of retirement policy at Hargreaves Lansdown, commented: “Pension scams can ruin people’s retirement, sometimes casting a permanent blight on their quality of life, for the rest of their lives. Investors need protecting from unscrupulous unregulated salesmen, so we welcome this announcement. The government’s plans to make it harder to register scam pensions in the first place and to make it easier for legitimate pensions businesses to block suspicious transfers are also important and welcome developments.”

Gillian Guy, Chief Executive of Citizens Advice, added: “Cold calling is a favoured tactic of fraudsters targeting people’s retirement savings.

“Citizens Advice found that as many as 10.9 million people received unsolicited calls, emails and texts about their pensions over the last year. Promises of high returns are used to trick people into fake investments leaving them with a reduced or even empty pension pot.

“The government’s ban on pension cold calls is the right move to protect people. The power to fine scammers also means enforcement bodies will be able to put a stop to any scammers that still target people’s savings.”