The Government has initiated an 8-week consultation to ban cold calls related to financial products like sham cryptocurrency schemes, mortgages, and insurance.
This action is a critical step in the implementation of the Government’s Fraud Strategy, aimed at stopping fraudsters from tricking people into buying fake investments.
Data from the City of London Police reveals that fraudulent investment schemes led to losses of £750m between 2022-23, emphasising the urgent need to address this issue.
Upon the conclusion of the consultation and the implementation of the ban, any person receiving a cold call offering these financial products will immediately know that it is a scam, significantly reducing the number of potential victims.
Security Minister Tom Tugendhat was vocal about the importance of this move, stating: “Fighting fraud is at the heart of our campaign to fight crime. The National Economic Crime Victim Care Unit and the cold calling consultation are delivering on our pioneering Fraud Strategy. Fraud doesn’t just lead to financial loss, it can destroy confidence and lead to severe stress. That’s why it’s so important that victims get the best possible care and support. The cold calling consultation is an important step forward in our efforts to block fraud at source. It will have a major impact once it is in force.”
In conjunction with the consultation, the National Economic Crime Victim Care Unit, responsible for assisting fraud victims, has been expanded to cover all 43 police forces across England and Wales. Since 2015, this unit has prevented losses of over £2.8 million to fraud and provided support to more than 113,000 victims.
Andrew Griffith, Economic Secretary to the Treasury, emphasised the severity of the problem, saying: “Cold calling for financial services and products has long been used by fraudsters to manipulate and trick members of the public into scams. These cold-hearted criminals will often purposely target the most vulnerable and use a range of deceitful tactics to take advantage in any way they can. We will ban cold calling for all consumer financial services and products, so the public can be sure that it’s not a legitimate firm if they get a call about a financial product out of the blue without their consent. We want people to feel confident to put the phone down and report these illegitimate calls.”
The Government’s broader Fraud Strategy, which was published on 3rd May, is already making strides in the fight against fraud. This includes recently passed legislation enabling the Payment Systems Regulator to require payment service providers to reimburse victims of specific types of fraud.
Anti-Fraud Champion Anthony Browne also underscored the significance of the consultation, noting: “80% of fraud is cyber-enabled and often starts with scam social media posts, a fraudulent email or false advertising and this makes engaging with the tech sector particularly important.
“Our tech sector is among the best in the world and has a proven track record for innovation. It is of the utmost importance that we work with them to bring about better protections for their customers.”
