The government has announced that the ban on cold-calling by pension companies will now include text and emails, two other common channels used by pension scammers who target savers' retirement funds.
According to the government, in the first five months of 2017 alone, almost £5 million was lost to fraudsters targeting people's retirement savings, with a total of £43 million being taken since April 2014. The government also said that the average amount of money lost by those people targeted by pension scammers was £15,000.
The new cold calling ban will prevent all cold calls, texts and emails about pensions and the new law will be enforced by the ICO (Information Commissioner's Office) who will have the power to fine companies up to £500,000 if they break the rules. However, they only have the power to take action against companies that are based in the UK. Not all calls about pensions will be banned, companies will still be able to contact people that have expressed an interest in their services or products and they will still be able to market to existing customers.
The pensions minister, Guy Opperman, said: "If people have saved for a private pension, we want to protect them. This is the biggest life's saving that individuals normally make over many years of hard work. By tackling these scammers, people should know that cold calling, apart from exceptional circumstances, is banned."
Whilst the news of the ban has been warmly welcomed, it's not clear as yet as to when the ban will begin. With the amount of legislation needed to be put through parliament for Brexit, it could be 2019 before the ban is included in the Queen's Speech, so says Sir Steve Webb, the former pensions minister.
"The worry is that with the current busy legislative programme, that it could be 2019 before the ban is included in the Queen's Speech. There is an opportunity for the ban to be added to a bill currently progressing through parliament, but if this opportunity is missed then I fear it could be a long time before the ban comes into effect. This is important enough to be done now."