Although The Association of Professional Financial Advisers (APFA) welcomed the Government’s proposals on the cold calling on pensions transfers, it warned that the ordinary marketing activities of financial advisers must be protected.
The APFA published its response to HM Treasury and DWP’s consultation on pension scams.
The association argued that more should be done to protect consumers by tightening the rules around the provision of unregulated investments.
And more needs to be done to prevent consumer losses in the first place, especially where there is a systemic cause. The association said that they are seeing the same thing time and again in pensions, and that retail investors are being sold inappropriate unregulated investments held within SIPP, or SASS products.
Prevention is better than cure said the AFPA and that reducing the size of the consumer losses should be the priority, and that the regulatory framework for unregulated products should be tightened.
Director General of APFA Chris Hannan said: “If the government implements these proposals swiftly, it will be a welcome step towards addressing the problem. Unfortunately, more will probably be needed. The regulator, the government, pension providers and advisers should work together to protect consumers from high-risk or fraudulent investments in which they are highly likely to lose their money. Further monitoring will be needed and prompt response as scammers move on to other ways to con people out of their savings.”
