The government has announced that it is to conduct a ‘technical consultation’ on its proposed ban on pensions cold calling.
This comes after it missed a deadline in June to finalise legislation that would protect older and often vulnerable consumers from scammers targeting their retirement savings.
As it has already consulted on the proposed policy, the Treasury says this “is a technical consultation intended to seek final views on the draft regulations to ensure they meet our policy objectives.”
However, while the move to ban cold calling has been broadly welcomed by the industry, Kay Ingram, director of public policy at Independent Financial Adviser LEBC says that it won’t fully solve the problem of pension fraud.
She says: “A far better way of protecting consumers from fraud would be to press ahead with the Pensions Dashboard. In discussions with the Department for Work and Pensions (DWP) feasibility team, we have put forward proposals which we believe would enable consumers to safeguard their pension information against misuse.
“By allowing access to the dashboard only to the consumer, their nominated regulated adviser or guidance body staff, consumers could be confident that their pensions information was safe. A simple PIN could be used by all authorised parties, protecting the consumer from criminal elements. Everyone we have discussed this idea with has been supportive. All we need know is for the DWP to legislate to make this happen”.
Last week, the pensions industry rounded on secretary of state for work and pensions Esther McVey, as rumours mounted that the Pensions Dashboard was to be “killed off”.
The Treasury says the cold-calling regulations should become law in the autumn. However, Jonathan Watts-Lay, director of Wealth at Work, a provider of financial guidance and education in the workplace, points out that even once the ban is in place, consumers will still need to be on their guard.
He says: “It’s time to send a clear message to pension scammers that this will not be tolerated, so the sooner this ban is implemented the better. However, once the ban is in place, individuals will still need to be alert as it’s not going to stop all fraudsters. After all, those approaching retirement are an attractive target as they have access to potentially large amounts of money. We urge people to still be very wary.”