The ban on unsolicited calls about people’s pensions came into effect on 9 January. This means that any firm making unwanted, unsolicited phone calls about pension payments may face enforcement action, including fines of up to £500,000.
As a Government statement pointed out, pensions fraud can be devastating, leaving victims without the means to fund their retirement.
One of the most common methods used by scammers to commit pensions fraud is through cold calls, which is why the Government has taken action. Incredibly, research by the Money Advice Service suggests that there could be as many as eight scam calls every second, equating to a staggering 250 million calls per year.
Commenting on the ban, John Glen, the Economic Secretary to the Treasury described pension scammers as “the lowest of the low” because they rob savers of their hard-earned retirement and devastate lives.
In fact, according to the Financial Conduct Authority (FCA), pension scammers stole on average £91,000 per victim in 2018, so banning pensions cold-calling should help to protect people from the criminals who make them.
Mr Glen went on to urge anyone who receives an unwanted call from an unknown caller about their pension to get as much information as they can and report it to the Information Commissioner’s Office.
Most pension scams start with an unexpected call, text or approach on social media or via email. This usually offers a free pension review or suggests a way to make attractive returns on pensions savings.
However, in many cases, the money is simply stolen or transferred into a high-risk scheme that is completely inappropriate for retirement savings. Many of these scams offer high-rolling investments in hotels or green energy schemes that never actually materialise or instead, lead to losses.
To find out more about how Kirk Newsholme Financial Planning can help, please contact Richard Leonard at Richard.Leonard@knfp.co.uk or by calling 0113 204 4215.