Chris Lees, Senior Research Officer, Money and Mental Health Policy Institute

Why the government should ban financial cold calls

9 October 2023

  • We responded to a recent government consultation on introducing a ban on cold calling relating to all financial services and products
  • Our research has found that people with mental health problems can face an increased level of risk when targeted by scammers
  • We have outlined a number of recommendations on how a government ban on cold calling could better protect people with mental health problems from financial and psychological harm as a result of scams.

We all know what it’s like to receive a call from an unknown number and to then be told that there is an amazing financial opportunity for us. This can sometimes be a mild inconvenience. However, unfortunately for some people, this can lead to losing money to a scam, and for many it can negatively impact our mental health.

The government recently consulted on introducing a ban on cold calling related to all financial services and products. In our response, we supported the ban and highlighted the risks that struggling with our mental health can expose us to and the harms that can result from cold calling.

Is that offer too good to be true?

A few years ago we looked at people with mental health problems’ experiences of online scams. We found that those of us with mental health problems are three times more likely to have fallen victim to an online scam. This can be due to common symptoms of mental health problems like difficulty processing information and increased impulsivity. 

We updated our knowledge by recently surveying our Research Community, a group of nearly five thousand people with lived experience of mental health problems, about their experiences of cold calls. And we found that common symptoms of mental health problems can also make it harder to avoid and spot cold scam calls.

“If I’m not feeling right I can get confused and sometimes I have agreed to something that I didn’t realise.” Expert by experience

For example, some members talked about how they struggle with unexpected calls or knocks at the door, which can make it harder for them to manage the conversation. Others explained how they can feel unable to terminate the call or close the door on someone. Finally, a common theme was that when unwell, it can be difficult to process what a cold caller is saying and recognise if it is a scam or not.

“When you are enduring the symptoms of [complex] PTSD, it makes you vulnerable and your level of attention to suspicious behaviour is profoundly compromised. You get caught off guard which can be terrifying when you slowly realise.” Expert by experience

An invasion of privacy

Losing money to a cold caller was relatively rare among our Research Community, but this can often be devastating for people. This is especially true for people with mental health problems who are more likely to be in financial difficulty. 

What was more common was the psychological impact, with nearly half (48%) of respondents saying their mental health was negatively impacted as a result of the cold call. In particular, members talked about how receiving an unknown call or person at the door can feel like an invasion of privacy. When we are unwell, it can become very difficult to leave our homes. Our home may become a safe space, and a cold call can destroy that feeling.

“My mental health issues mean that I struggle greatly with anxiety, especially going out and, even worse, being with people. My ‘safe space’ is my home, with all the doors and windows securely locked. Any unwanted or unexpected intrusion into my safe space frightens me greatly. It means it’s no longer safe. When I receive a phone call from someone that I do not know, that I was not expecting or was prepared for, it is an intrusion, especially if they know my name.” Expert by experience

This led to people taking a very cautious approach to any calls coming in, with seven in ten (70%) respondents sharing that they stopped answering calls or responding to messages following the cold call. While this meant they weren’t being exposed to scam calls, they were also missing out on legitimate communications from friends and family and services like the NHS. For some, this was leading to further isolation and loneliness.

“It’s hard to know whether it’s a scam or not. I don’t tend to answer the phone now unless I know the number. This makes me miss important calls, though. It’s definitely added to my isolation.” Expert by experience

No more cold calls?

In our response we made several recommendations for how the ban should work.

Firstly, we said that the government should include a broad range of cold calls – for example, door to door and calls on social media. Cold calling by phone or at the door is common, and while it is less common on social media, this would be a good opportunity for the government to get ahead of the curve and protect people from scammers. 

Secondly, we called on the government to include all financial products and services within the ban. These would include, for example, investments, loans, debt solution products and insurance. These products and services were the most common cold calls experienced by our Research Community. The financial difficulty many people with mental health problems face can mean they are especially at risk when exposed to these types of scams. 

“I always feel like prey. It’s too tempting, and I have to remind myself I’m not good with money so I shouldn’t take anything else on… Life is hard, and more money for basics would really help,, but I have to remind myself that it would just get me into more debt I can’t pay.” Expert by experience  

Finally, based on feedback from the Research Community, we also made recommendations for how the ban could be best communicated. The ban would be most likely to be received if it was communicated by trusted organisations, like charities and Money Saving Expert, and relevant organisations like someone’s bank. Adverts from the government would also help communicate the ban to a wider audience. Any messaging about the ban should be clear, easy to understand, informative and accessible.