The PLSA supports the Government’s cold-calling ban as it will make it easier for the industry and regulators to get behind a clear message to savers.
The cold calling ban will not act as a silver bullet. The PLSA is concerned that determined scammers will find a way around it, for example, by calling from overseas.
The Government should go further as the approach does not address the central problem which is that being a registered pension scheme is no proof of being a legitimate pension scheme.
The PLSA wants the Government to introduce an authorisation regime to stop rogue firms from entering the market and to tackle those using existing schemes as a vehicle for their activities.
As a first step towards this, the Government should require any new Small Self-administered Schemes (SSAS), or SSAS wishing to receive transfers, to have an independent professional trustee or another recognised professional on its board. This would be supported by an accreditation system for independent professional trustees, operated by The Pensions Regulator.
The PLSA suggests that starting with the smaller schemes would make sense as these are the ones that scammers normally use. Authorisation is already being introduced for master trusts and the risks in large single-employer and multi-employer schemes are much lower.
In the long-term – once the authorisation scheme is in place – the PLSA’s proposal is that members would only have a right to transfer to a scheme that is authorised.
James Walsh, Policy Lead: Engagement, EU & Regulation, at the Pensions and Lifetime Savings Association (PLSA), said: “Cold calling is one of the main methods used by scammers preying on vulnerable people, so the Government’s plan to ban cold calling is a much-needed step towards making life more difficult for scammers. The ban will give a clear message to savers that if you receive a call about your pension from anyone other than your own provider, put the phone down.
“However, we need a more ambitious approach from the Government if we are to fully protect savers. We are calling for the Government to gradually introduce an authorisation regime for pension schemes. The most pressing problem area at present is small schemes, so that is where we would start, but in the long-term we would expect all schemes who want to accept transfers to be authorised.”
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