Cold Call Ban Urged To Halt Pension Fraud

Growing fears about the antics of firms targeting people to unlock their pensions has led to calls for all cold callers from financial services firms to be banned.

The consumer help organisation, Citizens Advice,  says it is seeing increasing numbers of people who have been cold called and been persuaded to unlock their pension – which is also known as pension liberation.

This is a controversial practice which could see the pension saver being hit by a 55% penalty charge by HM Revenue and Customs for accessing their pension pot before the age of 55.

Citizens Advice is also calling for cold calls to be banned from credit brokers and claims management companies as well.

They say that 35% of all the complaints regarding financial services originated from a cold call.

82% of adults cold-called

Citizens Advice says that people are being made to pay upfront fees for a loan which never materialises and have their bank details passed to other firms who then contact them.

Many of the firm’s complained about also failed to follow their own product cancellation rules.

The news from Citizens Advice comes at the same time that an Ofcom study reveals that nuisance calls have been received by 82% of adults in the UK in a four week period.

Ofcom says that when the person being called has identified the reason for it they found that 22% of calls were for PPI claims and 10% were recorded sales calls for pension unlocking.

Citizens Advice have also analysed their complaints and found that more than a third of complainants were contacted by spam emails, texts, letters as well as cold calling.

They say that 97% of their complaints about unlocking pensions and 56% of PPI claim management complaints originated with a cold call.

Upfront cash demands

Half of these cold calls were demanding money upfront.

Between April 2012 and March 2013, Citizens Advice dealt with more than 30,000 complaints over cold calling for financial services and products.

Gillian Guy, chief executive of Citizens Advice, said: “Unscrupulous firms are hounding people and without banning financial services cold calling more people will risk losing part of their pension savings to a scam or paying for a service that doesn’t deliver.

“A cold calling ban will make clear to the person receiving a call that if they are being contacted out of the blue then it’s probably a scam or a service not to be trusted.”

Anyone who thinks they may have been victim of a scam can report their concerns to Action Fraud on 0300 123 2040.