Hasten cold-calling pensions ban, say MPS

A proposed ban on cold-calling pension scams must be brought forward to 2018, MPS have said.

The Commons Work and Pensions Select Committee welcomed the Government’s commitment to ban these scams, as set out in the new Financial Guidance and Claims Bill. But it said the Bill was flawed because it requires the creation of a new financial guidance body, which means the ban may not be implemented until 2020.

Labour MP Frank Field said that pensions are “rich pickings” for scammers. He added that changing the law now would see “an enforceable ban in place by summer”.

Fraudsters try to convince pensioners to invest their life savings in complex schemes that promise returns that are almost impossible to achieve. Schemes include investing in diamonds, overseas property, forestry and films.

Such scams have increased significantly since April 2015, when new laws allowed over-55s to take some or all of their pension as a lump sum. Almost £5m was lost in the first five months of 2017, with some sums exceeding £250,000.

The Treasury said it takes pensions scams “very seriously”, but that the amendment proposed by the committee may be “outside the scope of the bill”.

Tom Mcphail, pensions expert at investment company Hargreaves Lansdown, said the industry supports greater protection for pensioners, but called for a ban to be properly policed so it would “avoid interfering with legitimate business activity”.