A new law to ban pension cold calls must be prevented from having a “chink in the armour” by failing to include investments, a Chartered Financial Planner heading the campaign says.

Darren Cooke also insisted beefing up legislation on QROPS would be key to making any ban a success.

He welcomed reports at the weekend that plans to outlaw such unsolicited phone calls are expected in the Autumn Statement on Wednesday.

Mr Cooke APFS, Cert PFS (DM), director of Red Circle Financial Planning in Derbyshire, recently began an official Parliamentary petition, which attracted over 7,800 signatures. It won the backing of ex-Pensions Minister Ros Altmann and Steve Webb and firms such as Royal London, Zurich and Aegon.

Chancellor Philip Hammond is believed to be ready to ban pensions cold calling this week.

Mr Cooke told FP Today: “I’m very pleased, the reports are pretty much what we were looking for.

“If all we get are the basics of what’s been announced so far, that will be fantastic and dramatically reduce the number of people being scammed.

“If we make it not financially viable for people to scam they might trying to stop scamming people in this way.”

He said it was key to ensure investments were not excluded as part of any new legislation banning cold calling, as it could leave a “chink in the armour” for scammers to exploit.

With QROPS used by scammers involved in such practices, Mr Cooke said “we have to beef up legislation around that”.

Ideally, a ban would include email and text messages too, he said, although he believes calls are the most important to stop.

While a ban will “never be the answer to stop scammers by any stretch” it is an “achievable and significant measure”, Mr Cooke said.

He said: “Banning cold calling would dramatically reduce the number of people falling prey to fraudsters and losing their savings and pensions.”

He set out with a “singular aim to cut off cold calling” and to “cut off the head of the many headed snake” of scammers.

While fines already exist, firms involved in cold calling could face £500,000 penalties, reports stated, and Mr Cooke would like to see prison sentences as well.

The initial sponsors of the petition included a number of Financial Planners and among the first five were: Martin Bamford, of Informed Choice, 
Scott Gallacher, of Rowley Turton
, Al Rush, of Fiver a Day, 
Chris Daems, of Cervello, 
Phillip Bray, of Sense Network.

More reaction

Angela Brooks of Pension Life, set up to identify and prevent pension scams, close loopholes in pension law and rescue victims of pension fraud, said: "Scammers are using the so-called freedoms to lure people into parting with their life savings by cold calling them with offers of non-existent or worthless investment opportunities.

“Mr Hammond’s announcement is a major step in the right direction and a golden opportunity to correct the disastrous, ‘chocolate teapot’-esque rules that have allowed so many people to lose their retirement funds.

“This is all good news - and better late than never. After a series of useless UK government ministers consistently refused or failed to take any action, we do now appear to have a cabinet that has at last recognised that this is an extremely serious and urgent problem.”

Yvonne Braun, director of long-term savings at the Association of British Insurers, said: “Cowboys should not be allowed anywhere near people's life savings. Just as cold-calling on mortgages is banned the same protection is needed for pensions, and we’re pleased to see the Government making a move on this.

"Pensions scams are a huge problem and something the sector is keen to tackle. Banning cold-calling should do a lot to help, but further measures to clamp down on dodgy trust-based schemes will also be essential, as will allowing providers to block suspicious transfers.”

Tom Selby, senior analyst at AJ Bell, said: "The scourge of pension scams has already caused huge damage to thousands of savers’ retirement dreams, with many left penniless after being targeted by increasingly sophisticated fraudsters.

"The combination of measures set to be announced by Chancellor Hammond should act as a real deterrent to scammers and sends a clear signal the Government is at last taking this issue seriously. We look forward to seeing further details at the Autumn Statement."

Kate Smith, head of pensions at Aegon, said: “The true extent of pension fraud is unknown, and some people may not realise they have fallen victim to a scam for some time. Once a scam has taken place it’s almost impossible to get the money back.

"The proposed ban on cold calling is a major step forward but it needs to go further to cover texts and emails other common techniques used to try to part people from their hard-earned cash. Scams are constantly evolving as soon as you remove one fraud method, another variant on the old scheme pops up. A ban on cold calling won't be foolproof, but at least it will put more people on their guard and criminalise those who make the calls. People should remember the old adage, if something looks too good to be true it probably is."