AJ Bell has urged the government to consider creating a ‘Minster for Scam Prevention’ role to tackle financial scams amid the Work and Pensions Committee’s (WPC’s) ongoing inquiry into pension scams.

Speaking at a WPC evidence session yesterday (7 October), AJ Bell senior technical consultant, Rachel Vahey, argued that the impact of financial scams on society means that greater parliamentary focus is required, stating that “now, more than ever it’s important to develop further action".

Vahey explained that creating an overarching role in parliament, whose sole focus is stopping the "ever-growing swell of scams", could be an effective way to help people protect their savings.

She emphasised that the financial uncertainty created by the Covid-19 outbreak is like "blood in the water for scammers", with millions of people facing the prospect of unemployment and "staring down the barrel" of serious financial hardship.

Vahey continued: “Such turmoil will inevitably see more people targeted by scammers, with their hard-earned – and sizeable – retirement pots likely to be a prime focus.

“This is wider, however, than just pension scams. This extends to investment and other financial scams. Pension freedoms allows someone to encash their entire pension pot.

“What they do with it after that – how they invest or spend it – is up to them. Pension schemes cannot keep tabs on that."

"We need as a society to take scams more seriously; to put our money where our mouth is."

In particular, Vahey called for greater awareness of scams to ensure people are "tuned into the threats of scams", as well as tougher penalties and consequences for scammers, to ensure that the downside of their action is a "serious deterrent".

Furthermore, she also highlighted the importance of enabling pension schemes to take the right action to stop scammers where possible.

The comments were made in response to the committee’s investigation into pension scams, which is the first strand of a three-part inquiry into the impact of the pension freedoms and protection of pension savers.

In its response to the inquiry, AJ Bell also outlined several ways in which government and regulators could “take the fight to pension scammers”.

This included recommendations such as broadening the cold-calling ban to cover not only social media and emails, but also “factory gating” where lead generators meet prospective clients in person.

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