Finance companies could soon be outlawed from making cold calls about pensions following fears that the pension freedoms have triggered a rise in fraud, with speculation mounting that the ban could be unveiled in the Chancellor’s Autumn Statement.
While cold calling is frowned upon by some – including the DMA, it seems – advocates argue that, as it is still legal, more should be done to support the legitimate industry rather than batter it.
They 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. They also believe that current confusion over the Telephone Preference Service should be addressed to enable legitimate marketers to distance themselves from the rogues. Over 50 DMA members are involved in either telephone data or outbound telemarketing.
But the looming crackdown follows mounting evidence that fraudsters are using the pension freedoms to trick people into parting with their life savings by cold calling them with offers of “once in a lifetime” investment opportunities.
Lord Young, the Conservative peer and Treasury spokesman in the Lords, said that there will be an “announcement” within weeks adding that he expects it “will meet expectations”.
Police have disclosed that reported fraud has risen from £10m in the year before the pension freedoms were introduced, to £18m in the year after.
A Government spokesman said: “We are determined to tackle the scourge of nuisance calls, especially those of a fraudulent nature. We take the issue of pension scams, and the targeting of vulnerable people through cold calls, very seriously and are currently considering ways to protect consumers from pension scammers.”
Late last year, peers accused the Government of dragging its feet over passing laws to protect consumers from being cold called by firms working for debt management companies, as figures showed this problem was escalating, too.
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