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Mixed responses to UK pension scam consultation

The UK government’s consultation on tackling pension scams received mixed responses, as it acknowledged that the pension freedoms may have contributed to the rise in scams.


The consultation, launched in December, put forward various proposals for reform, including a ban on cold-calling and restrictions on pension transfers.

The government also acknowledged the introduction of pension freedoms in April 2015 may have contributed to the rise of scams.

Cold calling ban a threat

Kate Smith, head of pensions at Aegon, believes that a blanket ban on cold calling may pose a threat to some legitimate practices within the regulated adviser community and the best way to protect consumers is to heighten awareness of fraudulent practices.

She said: “It could become very difficult for [Financial Conduct Authority] regulated professional advisers to narrow the advice gap and improve customer outcomes through calls, or via a third party-introduction. We need a solution that stamps out bad practice without stopping good. 

“Any campaign to raise awareness of scams needs to avoid discouraging people from seeking help. As an industry we should be trying to increase people’s engagement with their pension savings not scare them off.”

She suggests an FCA/ Information Commission’s Office (ICO) website listing all the regulated firms so people can check the legitimacy of anyone who calls.

Smith, however, supports limiting the right to a statutory transfer, which would give pension providers powers to stop suspicious transfers or suspend them until they have checked the receiving scheme is genuine.

Cold calling ban not enough

In contrast, the Association of British Insurers (ABI) believes the ban on cold calling on pensions should be taken a step further by banning ‘cowboy’ firms from contacting consumers via all forms of digital communication.

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