Drive to stop elderly being ripped off over their finances

ELDERLY people could for the first time be given extra protections to stop them being ripped off or discriminated against when they buy mortgages, insurance and savings products, as watchdogs launch an investigation into financial ageism.

The Daily Telegraph understands that the Financial Conduct Authority could enforce a new “anti-ageism” regime within a year in which firms may be banned from discriminating against customers because of their age.

On Monday, in a parliamentary meeting, the regulator will set out a new paper outlining growing concerns by charities and industry bodies about how Britain is meeting the financial needs of the rapidly ageing population.

In the report, Britain’s largest charity for elderly people, Age UK, will recommend that the FCA reviews financial companies’ special exemption from the Equality Act, which allows them to discriminate against the elderly.

Last night legal experts warned such a move would be “foolish” as it would drive up overall costs and lead to younger generations paying thousands of pounds more for financial products.

The FCA is to focus on ageism in the mortgage market as borrowers in their 40s and 50s are being told they are “too old” when they apply for loans. In recent years the Financial Ombudsman, the arbiter of disputes, has upheld a number of mortgage grievances relating to older borrowers complaining they were unfairly rejected by lenders.

The FCA could also introduce rules to prevent elderly people who do not use smartphones or the internet from being unfairly excluded from preferential online deals and services. For example, DIY investors who use the telephone are being charged as much as £472.50 a year more than people who trade shares online, Telegraph research shows. Superior credit card deals can also be found online with the average balance transfer deal for cards bought online 25 months long, compared with 11 months offline.

The watchdog said it has held private talks with big banks and financial institutions to “nudge” them into using new technology to improve safety and security for ageing customers. Banks including HSBC and Barclays will soon roll out voice and touch recognition systems to make logging in easier for customers who struggle to remember their PINs.

Robin Ellison, a partner at Pinsent Masons, a law firm, said: “It is foolish to want equal financial treatment for people who aren’t really equal, because it just puts costs up for everyone else.”