Cold call ban for all financial products – a welcome next step, still plenty more to do to protect consumers from fraud
- About time too – Government moves closer to banning cold-calling for financial products.
- Plenty more to do – such as publicity drive telling people to hang up on cold-callers and simplifying the baffling array of anti-fraud agencies – FCA, ICO, Ofgem, Action Fraud, City of London Police…
- Consultation won’t stop the fraudsters, but this is a step in the right direction to protect the public from scams.
- Older people are more at risk of attempted fraud calls and are often on cold-callers’ ‘suckers’ lists.
About time too – after banning pension cold calling, Government is finally consulting on cold-call ban for all financial products: In 2019, the Government legislated to ban cold-calling in connection with pensions, to help stop the epidemic of scams that had proliferated in past years. Many people had fallen victim to fraudsters and lost significant sums. Fraud is estimated to account for 40% of UK crime and cost victims £7billion a year, so action to curb this plague is clearly important. Cold calling by claims management, mortgage and funeral plan firms is also banned, but at last the Government is consulting on banning unsolicited calls for all financial products. This Consultation https://www.gov.uk/government/consultations/ban-on-cold-calling-for-consumer-financial-services-and-products follows measures earlier this year to expand fraud-prevention. Many fraudulent operators are based offshore, difficult to find, and even more difficult to enforce with penalties
Just another step in the right direction, plenty more to do to protect the public: A ban on cold-calling won’t stop all fraud and is just one of the measures that can improve protection against scams. Equally important is clear messaging for the public that explains why they should not engage with anyone who calls them out of the blue about financial products. There needs to be a publicity campaign which makes clear that an unsolicited call will be from someone acting illegally. This will help people realise they should be suspicious and should just hang up.
Government also needs to streamline regulation and reporting of fraud – current situation too confusing: Regulation of cold calls is currently plagued by overlapping rules from different bodies. The Information Commissioner’s Office (ICO), Financial Conduct Authority (FCA) and Ofgem, each have powers over certain aspects of cold-calling, for example FCA rules govern marketing and promotions of financial products, Ofgem can cancel phone numbers of require providers to block phone numbers that have been misused and ICO can fine firms which use people’s private data without consent. But the current patchwork of regulations just confuses consumers. Indeed, when wanting to report a fraud, people do not know who to turn to. They will have heard about the Financial Ombudsmen services, Telephone Preference Service, Action Fraud, City of London Police, ScamSmart, FCA registers and more.
Older people are often more at risk of being targeted by suckers’ lists: The impact of cold-calls is not evenly spread across the population, with a small number of people disproportionately affected – many being targeted at least once a day. Older people are often specifically targeted because their generations tend to be more trusting and those who answer their landline or mobile to engage with cold-callers seem more likely to be on so-called ‘suckers’ lists’. This means their data are passed to others, resulting in multiple calls after they are considered to be higher-likelihood targets.