Timms, though reluctant to pre-empt the findings of the committee’s pension scams inquiry, nonetheless told Pensions Expert that it was “a very strange thing” for the law to require trustees to approve transfers, even when the destination scheme is included on the Financial Conduct Authority’s warning list.

“If the FCA is sufficiently worried about this to warn people, it seems to me that trustees not only should not be required to make the transfer, they should be obliged not to make the transfer,” he said.

“I would hope we can come up with some arrangement that means, in effect, that if something is on the FCA’s warning list, then that transfer should not go ahead.”

He welcomed the government’s commitment to legislate on the back of the Pension Schemes Act to tackle the issues around transfers, and said the pensions minister expects those regulations to take effect in September or October this year.

Timms also criticised the “fragmented nature” of the way pension scams are handled. 

At present, the bodies that can be involved in the reporting and handling of scams include the Pensions Regulator, the FCA, the Insolvency Service, HM Revenue & Customs, the Information Commissioner’s Office, the Police Service, the Serious Fraud Office, as well as Action Fraud and the Pensions Ombudsman.

Timms quoted a serious fraud investigator who had said that there are so many regulatory bodies, criminals can make use of the “greyness” in figuring out the next scam.

“There’s a lot of confusion about who you go to, what happens when you’ve gone to them… All these issues need some clarification,” he said, citing industry participants who had told the inquiry that the arrangements for them to share information about fraud are inadequate.

Although he said Project Bloom, which brings some of these bodies together, is a “good approach”, Timms argued that its status needed to be looked at and perhaps “upgraded in some way to give it the clout that it needs”.

The inquiry’s report may criticise a disproportionate allocation of funding given the severity of crime, with fraud generally amounting to around a third of all crime in the UK yet receiving only 1 per cent of policing resources.

“It’s undoubtedly true that Action Fraud is pretty thinly stretched,” he said, and the question of resources “is one that we’re going to want to reflect on in our report”.

Finally, Timms suggested, in line with a Police Foundation report, that  there might be cause for HMRC to take a “softer approach when it comes to imposing tax penalties on those who have been defrauded”.

The inquiry’s report is expected to be published in the next couple of months.

Pensions Expert podcast has ranked third on the ‘Top 15 Pension Podcasts You Must Follow in 2021’ from Feedspot.

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