Plans to ban cold calls for financial products such as sham cryptocurrency schemes, mortgages and insurance have been set out with the launch of a consultation, marking the next step in delivering the UK government’s fraud strategy.
The eight-week consultation, published on 2 August, will cover proposals to ban cold calls offering any financial products to clamp down on fraudsters seeking to trick people into buying fake investments.
Once in force, people receiving a cold call offering these types of products will know that it is a scam, and fewer people will become victims.
Fraudulent investment schemes represent a significant threat to the UK economy, consumers, and society, with victims losing £750m ($959m, €873m) between 2022-23, according to data from the City of London Police.
A specialist team which provides support to victims of fraud, known as the National Economic Crime Victim Care Unit, has also been rolled out to all 43 police forces across England and Wales since the Fraud Strategy was announced.
Tom Tugendhat security minister said: “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.”
Myron Jobson, senior personal finance analyst at Interactive Investor, said: “Scam cold calls have become a begrudgingly accepted part of everyday life, causing financial and emotional distress to those who fall victim. Any effort to prevent fraudsters from infiltrating their way into people’s lives is welcome.
“Scammers are adept at tapping into the cultural zeitgeist and exploiting the fear of missing out disposition to create believable stories that convince you to give them your money or personal details.
“As well as a pounds and pence cost, falling victim to a financial scam has a broader psychological and emotional impact that can linger and cause distress well after the scam is over. Victims may feel violated and anxious, as their privacy is invaded, and they fall victim to deceitful tactics.
“Trust issues may arise, making it difficult to discern legitimate calls from potential scams. There is anecdotal evidence that fewer people are answering their phones from numbers they don’t recognise in a bid to dodge scam calls. The danger is many legitimate and important calls from pharmacies, doctor’s offices or schools, could be missed as a result.
“We must remain alert to potential threats that come in all different shapes and forms. We often overestimate our ability to spot a financial scam when, in reality, even those who consider themselves financially savvy aren’t immune to increasingly sophisticated scams.
“Unfortunately, with so many fraudsters hiding in the shadows and escaping detection, the onus is on individuals to avoid falling prey to financial fraud – there is no getting away from it. We all need to be on our guard.”