The Government is to press ahead with a ban on pensions cold calling – which will also include text messaging and email – despite appearing to have dropped the measure in the Financial Guidance & Claims Bill, published last month.
Confirming the move over the weekend, the minister for pensions and financial inclusion Guy Opperman cited figures which show fraudsters have tricked savers out of nearly £5m collectively in the first five months of 2017. It is estimated that £43m has been unlawfully obtained since April 2014.
The crackdown will also see a tightening of rules to stop scammers opening fraudulent pension schemes; and tougher action to halt the transfer of money from occupational pension schemes into fraudulent accounts.
Opperman said: “Today’s figures highlight the extent to which people’s savings are being targeted and stolen through elaborate hoaxes – leaving them with little opportunity to build up their savings again. That is why we are introducing tough new measures for those who scam.
“If people have saved for a private pension, we want to protect them. This is the biggest lifesaving that individuals normally make over many years of hard work. By tackling these scammers, people should know that cold calling, apart from exceptional circumstances, is banned.”
Breaches of the legislation, which will be policed by the Information Commissioner’s Office, could trigger fines of up to £500,000, although the Government has not given details of the timetable for the new rules.
There will be two exemptions from the proposed ban to ensure legitimate businesses are not affected – calls where consumers have expressly requested information from a firm and those where an existing client relationship exists.
However, some fear the ban on cold calling could easily be expanded to other areas. While the practice is frowned upon by some, advocates argue that, as it is still legal, more should be done to support the legitimate industry rather than batter it. The telemarketing industry employs tens of thousands of people in these roles.
Supporters insist that the term “nuisance call” is bandied about too readily and that cold calls can be welcomed by many consumers when carried out effectively.
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