The pensions minister would like to see HM Revenue & Customs have a more active participation in combating pension scams.
In a written response to the work and pensions committee inquiry on pension scams, economic secretary John Glen said HMRC has always cooperated with Project Bloom - one of the main initiatives to tackle pension fraud - but it is not an active member of the organisation due to its duty of “taxpayer confidentiality”.
Addressing the committee hearing on Wednesday, pensions minister Guy Opperman said that while he fully respects and understands this is "a classic problem of data sharing", he said HMRC could take a "much more active role" in Project Bloom while still respecting taxpayer confidentiality.
He said: “I would very much hope that HMRC can become much more actively involved in Project Bloom in the future, because they should be able to be part of the group […] in circumstances where we need as many hands on deck as possible.”
Mr Opperman also argued that the pensions industry has a bigger role to play in combating pension scams.
He said that the Pension Scams Industry Group “has done a very good job” and currently has 50 pension organisations participating in a data sharing project.
“But the practical reality is that you need about 200 organisations for there to be a real coverage of that industry. In other words, there are 150 firms who are not providing that data.”
Mr Opperman revealed that he would be writing to these industry participants and ask them why they are not participating in the data sharing initiative.
“That will galvanise a great deal of change in a really quick amount of time. I think that will make a big difference.”
Action Fraud figures also published on Wednesday showed fraudsters pretending to be legitimate companies stole £78m from unsuspecting victims through pension and investment scams in 2020.
Facebook and Google
Reports of clone firms increased 29 per cent in April 2020 compared with March as fraudsters looked to take advantage of uncertainty created by the Covid-19 pandemic.
While this issue is out of his remit, Mr Opperman said: “I have absolutely no doubt whatsoever that Google needs to take a very long hard at themselves and to change their ways.”
Scammers operate by setting up clone firms using the name, address and firm reference number of real companies authorised by the Financial Conduct Authority. They then send out sales materials linking to the websites of legitimate companies, to trick potential investors into thinking they are dealing with the real firm.
“We’ve reached the situation where the number one provider of information isn’t a newspaper or an encyclopaedia, it is Google, and in some instance Facebook.
“I have very strong views that what is going on and what Google and Facebook are allowing to happen is utterly unacceptable.”