Call for Consumer Protection
15th January 2018
The Work and Pensions Select
Committee is calling on the Government to urgently improve protection for
people’s pensions. This is absolutely right.
many people are losing their pensions as a result of fraudulent cold-callers
who entice them to transfer their hard-earned savings into scam schemes.
Committee is calling for a proper ban on cold-calls to be introduced urgently
in the Financial Guidance and Claims Bill which is going through Parliament at
the moment. It is also calling for everyone to be automatically offered an
appointment with the Government’s free financial guidance service before they
transfer money out of their pension. These measures would significantly improve
to the hard work of the House of Lords, the Government was defeated, by a
cross-party group of Peers, and forced to include measures which the Work and
Pensions Select Committee is calling for. Members from all sides of the House
joined together to add these important amendments to the Bill. Requirements to
ban cold-calling and to ensure everyone automatically receives free help to
discuss their pension before deciding to transfer have been added. Now the
House of Commons can build on them to strengthen the legislation even further.
customers wishing to transfer or withdraw pension savings need to be
‘automatically-enrolled’ into free financial guidance, unless they have an IFA.
The free PensionWise service has satisfaction rates around 90% but uptake is
woefully low – less than 10% have a guidance session.
everyone is auto-enrolled into guidance should help them make better-informed
decisions and protect more people against scams. It can also help them
understand the tax advantages of keeping money in their pensions for longer, to
avoid losing some of the savings unnecessarily.
scams originate from a cold-call and banning cold calling is really important.
The Government has already said it wants to do this but it must act urgently
and also implement a ban in the most effective manner.
the FCA responsible for banning both cold-calling and also the use of leads
obtained from unsolicited approaches would best protect people. FCA
implementation could strip firms of their licence if they benefit from
cold-calling, thereby undermining the business models of cold-callers most
effectively. Cold-calling for mortgages was banned long ago, now we must do
this for pensions too.
give the public a clear message – if anyone contacts you out of the blue about
your pension, they are breaking the law. If you get an unsolicited phone call,
just hang up. If you get a text, just delete it. Currently, the public do not
realise the dangers of someone offering them a ‘free pension review’ or an
exciting new pension investment scheme with great returns.
sooner these measures are passed and implemented, the safer our pensions will