Pension Data Sales Claims Trigger Inquiry

An investigation has been launched by the data watchdog into claims that details of milllions of people's pensions are being sold to cold-calling firms and fraudsters.

The Information Commissioner's Office (ICO) has described the revelations as "very worrying" and said it would be speaking to regulators and police.

The allegations have reinforced concerns about an upsurge in fraud as changes are introduced giving people access to their entire pension pots.

From 6 April, people can cash in their pension savings when they retire, rather than purchase an annuity.

Details of people's salaries, the value of their investments and the size of their pensions are being sold for as little as 5p without their consent, according to the Daily Mail.

The paper said its undercover reporters were sold information about the pensions of 15,000 people without any checks being made on who they were and what they would do with the data.

The ICO has already warned the pension reforms being brought in could lead to more people being scammed.

Steve Eckersley, the head of enforcement at the ICO, said: "It suggests a frequent disregard of laws that are in place specifically to protect consumers. We will be launching an investigation immediately.

"We're aware of allegations raised against several companies involved in the cold-calling sector, and will be making inquiries to establish whether there have been any breaches of the Data Protection Act or Privacy and Electronic Communications Regulations."

The ICO has the power to slap companies with fines of up to £500,000 for the most serious breaches of the Data Protection Act and can pursue criminal prosecutions around unlawfully obtaining or accessing personal data.

Mr Eckersley added: "The information we've been shown supports the work we've been doing to target the shady industry that operates behind the nuisance of cold calls and spam texts.

"We're already aware of the potential for a huge spike in the number of scam texts and calls linked to pensions when the law changes in April, and have already taken action against a company that was sending out misleading messages.

"What we've seen here confirms those fears. Personal (LSE: PGH.L - news) data is such a valuable asset, particularly financial information.

"The worst case scenario here is this information getting into the wrong hands and being used to target individuals at a critical point in their financial lives."