The pension cold-calling ban will take effect today, 9 January, making it illegal for any member to receive unsolicited calls about their pension.
Companies who are caught making the nuisance phone calls could face enforcement action and fines of up to £500,000.
The legislation was originally intended to be introduced in June 2018, however, the government admitted it had missed the deadline, launching a consultation in its place.
According to the Financial Conduct Authority, pension scammers stole an average of £91,000 per victim last year.
Economic Secretary to the Treasury, John Glen, said: “Pension scammers are the lowest of the low. They rob savers of their hard-earned retirement and devastate lives. We know that cold-calling is the pension scammers’ main tactic, which is why we’ve made them illegal."
Pensioners who believe they are being contacted by scammers are being urged to report it to the Information Commissioner’s Office.
The ban, although well overdue, has been roundly welcomed by the industry.
Pensions Scams Industry Group (PSIG) chair, Margaret Snowden, said: “PSIG called for a change in the law when we first published our voluntary Code of Good Practice in Combating Pension Scams in 2015, so we are encouraged to now be seeing this coming into force.
“Of course, a ban on cold calling will not deter all scammers, but anything that makes it more difficult is a good thing. A significant public awareness campaign will now be vital to ensure that the man in the street is aware that cold calls about their pensions are now illegal.”
PSIG, a voluntary body set up to support trustees, providers and administrators to combat scams, said it will be publishing version 2.1 of its Code of Conduct before the spring.
Pensions and Financial Inclusion Minister, Guy Opperman, added: “Pension scams are despicable crimes, fleecing people of the retirement they’ve earned by doing the right thing, working hard and saving for the future. Banning pensions cold-calling will protect people from these callous crooks and ensure fraudsters feel the full force of the law.”
The ban was finally approved by the House of Commons on 18 December 2018 in the Privacy and Electronic Communications (Amendment) (No. 2) Regulations 2018.
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