Cold calling ban may be introduced this week

Cold calling ban may be introduced this week

The government might legislate on the pensions cold calling ban as soon as next week in the second Finance Bill of this year, according to Rachel Vahey, product technical manager at Nucleus.

The introduction of a ban on cold-callers who try to scam people out of their pension savings, which will include emails and texts, was announced on 21 August.

Article continues after advert

At the time of the announcement, the government said the legislation to deliver the ban would be brought forward when parliamentary time allows.

The second Finance Bill of 2017 is scheduled to be moved in the House of Commons on Wednesday (6 September).

Ms Vahey told FTAdviser that the cold calling ban would be generically introduced in this document, while “secondary legislation to be brought forward in the future will introduce other caveats”.

She said: “A lot of details will have to be panned out by secondary legislation, such as how the exclusions will work.”

There will be two exemptions from the proposed ban, to ensure that those with legitimate businesses are not affected, the government said.

This will apply to calls where consumers have expressly requested information from a firm, and those where an existing client relationship exists.

Sir Steve Webb, head of policy at Royal London, said that it is possible that the cold calling ban is introduced next week.

However, he said he would be surprised if that happened since the government has said it would legislate when parliamentary time allows.

“It would prove that they have listened to the industry requests” for a swift action on this matter, he said.

Several industry experts, including Sir Steve, urged the government to draft new legislation on the cold calling ban so it could be implemented “as a matter of urgency”.

Sir Steve agrees with Ms Vahey opinion that the details of the new rules will only be addressed in secondary legislation.

He said: “I would be astonished if cold calling would be banned by the end of next year.”

The new protection measures also include tougher actions to help prevent the transfer of money from occupational pension schemes into fraudulent ones; and a tightening of HMRC rules to stop scammers opening fraudulent pension schemes.

Limiting transfers of pension pots from one occupational scheme to another will mean trustees must check their receiving scheme is regulated by the Financial Conduct Authority (FCA), or has an active employment link with the individual, or is an authorised master trust.

Ms Vahey said: “This proposal is linked to master trust authorisation regime, which will only be published next year.”

This means that this measure can only be brought forward in 2018, she noted.

Regarding the HM Revenue & Customs rules, the government wants to ensure that only active companies, which produce regular, up-to-date accounts, can register pension schemes.

According to Nathan Long, senior pension analyst at Hargreaves Lansdown, this proposal is expected to be included in the Finance Bill.