Companies that make unsolicited calls to people about their pensions will now face fines of up to £500,000, under a new cold-calling ban that came into force on 9th January.
With employees now able to access their pensions savings from 55 onwards, attempts at pension scams have become rife. As many as eight suspect calls take place every second, according to the Money Advice Service. For those that are caught out the average loss is £91,000 according to the Financial Conduct Authority (FCA).
The ban covers any cold-calling in relation to pensions as this is the scammers’ main tactic, according to Economic Secretary to the Treasury, John Glen. It’s now only permissible to contact someone about their pension if the caller is FCA-authorised, or the trustee or manager of an occupational scheme. The recipient must also consent to the conversation or have an existing relationship with the caller. Anyone who receives an unsolicited call about their pension or thinks they have been the victim of a scam should contact the Information Commissioner’s Office.
What does it mean for business?
Sadly, it’s unlikely that the cold-calling ban will mean the end of pensions scams – although it’s a welcome start. Keeping employees safe means equipping them with the knowledge to spot a scam call and with access to good quality, trusted advice on pensions.
Decisions about how to use pension savings are often irreversible and almost all employees will need support at this stage in their lives. The better informed and supported employees are, the less likely they are to become prey for scammers. You could do no better than point your employees in the direction of Brunsdon’s previous news item on the subject - https://brunsdonfinancialservices.co.uk/news/4-top-tips-to-protect-yourself-against-pension-scammers
As employee benefits and workplace pension specialists, we can support your employees throughout their working lives with pensions advice and financial education. Please contact us if you need further advice.
Please note that this article does not constitute specific personal advice. The Financial Conduct Authority (FCA) does not regulate some elements of Automatic Enrolment. Brunsdon is not responsible for the content of third party websites.