Questions remain on new law banning pension cold calls

10 May 2018

The Work and Pensions Committee welcomes the passing into law of the Financial Claims and Guidance Bill, which incorporates the ban on pension cold calling that the Committee called for in its December 2017 report Protecting pensions against scams: priorities for the Financial Guidance and Claims Bill.

The Committee now looks forward to seeing the detail of how the ban will be made effective, by the deadline of June this year - for example in the role of the Financial Conduct Authority in supporting the enforcement of the ban, and the action that can be taken against third parties who use information obtained illicitly through a cold call.

Committee concerns

Committee Chair Rt Hon Frank Field has written again to the Economic Secretary to the Treasury however, with further questions on the detail of, for example, what will constitute “unsolicited direct marketing”.

The Committee is concerned about practices such as “factory-gating”, uncovered in evidence in the British Steel Pension Scheme part of the inquiry.

This practice sees “introducers” working on behalf of financial advice firms approach scheme members in person, sometimes offering incentives, either near their workplaces or at roadshow events organised by the Scheme itself for people facing complex choices about their pensions.

In the letter, the Chair notes that:

“it is easy to imagine how a skilled marketer could use the opportunity of a face-to-face conversation to gain the trust of a ‘prospect' and persuade them into a particular course of action.
When the ‘cold call' is in person, it is not simply a matter of putting the phone down or deleting a spam email.”

Further information

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