Michelle Cracknell, chief executive of The Pensions Advisory Service (TPAS), has said that she believes some claims management companies (CMCs) are passing consumers’ details to pension scammers.
Speaking at an event called Unpackaging Pensions, hosted by trade publication FTAdviser, Ms Cracknell said that her organisation had received a number of calls from people who had previously been in contact with a CMC regarding payment protection insurance, and who had since received suspicious cold calls regarding their pensions.
It may be the case that the CMCs feel they are justified in doing this because the individual previously ticked a box saying they were happy to receive marketing communications from third parties.
Existing data protection law expects companies to be transparent with customers regarding exactly who their personal data may be passed to. Even more stringent laws regarding this will come into force from May 2018, when the European Union’s General Data Protection Regulation becomes law.
Ms Cracknell went on to speak of her concern about the problem of pension scams, highlighting that some scams “are completely legal”, even if they were also “nasty, horrid and expensive”.
The TPAS chief added:
“If you move your pension pot into another legal pension pot, in which the investments are then made in something really inappropriate, there is nobody to protect you in that scenario.”
She welcomed the Government’s plans to press ahead with a ban on firms making cold calls regarding pensions, although the Government has said that the legislation will only be introduced when there is sufficient parliamentary time.
Ms Cracknell however said that the ban would only work if it was accompanied by a “very big awareness campaign”, adding that “the pickings are far too rich for these scammers to stop” simply because cold calling was to be made illegal.
Under the Government’s plans, firms will only be able to make calls regarding pension services to clients with whom they have an established business relationship. This means they will not be able to cold call anyone who may simply have opted in to receiving marketing communications at some stage in the past. Texts and emails will also be covered by the ban. Firms that flout the ban could face fines of up to £500,000 from the data protection watchdog, the Information Commissioner’s Office.
Gillian Guy, chief executive of Citizens Advice, said:
“Banning unsolicited calls – a move Citizens Advice has been calling for – will make it much easier for people to spot a pension scam, and should put fraudsters off making contact out of the blue in the first place.”
The Government believes that some £5 million was lost by UK consumers to pension fraudsters in the first five months of 2017, and that the losses over the last three and half years total £43 million. The average loss for each victim of the scammers is put at £15,000.
The information shown in this article was correct at the time of publication. Articles are not routinely reviewed and as such are not updated. Please be aware the facts, circumstances or legal position may change after publication of the article.