The Financial Conduct Authority (FCA) has stopped a firm that advised transfers out of the British Steel Pension Scheme (BSPS) from disposing of its assets.
The regulator published a statement on 21st April saying it had stopped David Stock & Co Limited (DS&C) from taking such action as the business couldn’t demonstrate it had adequate resources, a minimum requirement for FCA-regulated firms.
The FCA also reiterated that this requirement is in the interests of its “statutory objective to protect consumers.” DS&C has the right to refer the FCA’s decision for review.
The FCA currently has an open consultation regarding a redress scheme for former BSPS members who received unsuitable transfer advice to transfer out of their pension. Upon launching the consultation, the FCA wrote to firms involved in BSPS transfers making clear they shouldn’t dispose of any assets and should maintain adequate financial resources to carry out reviews and compensate customers who received unsuitable advice should the redress scheme be given the go-ahead.
The regulator says it will impose requirements on financial advisers when:
- They’re unable to demonstrate they have adequate financial resources
- They’ve failed to act in conjunction with the instruction to protect assets
- They’re found to be attempting to take action to avoid paying compensation
While the consultation is continuing at the time of writing, any redress will only cover scheme members who transferred out between 26th May 2016 and 29th March 2018.
In addition, any redress scheme will exclude BSPS savers who:
- Have already received redress of some form
- Have referred a complaint to the Financial Ombudsman Service (FOS)
- Have received a final outcome from a suitability assessment of their case
- Are an “insistent client”
- Received advice outside the relevant period
Part of the FCA’s efforts to stop firms from disposing of assets is likely an aim to ensure firms remain in business so they can pay redress themselves, rather than savers having to go to the Financial Services Compensation Scheme (FSCS), where compensation would be capped at £85,000. In March, a National Audit Office report estimated that redress could fall short by £18 million when all is said and done.
The notion of firms involved in providing BSPS transfer advice conducting internal reviews of the advice they’ve provided has also proven controversial, with MPs saying in January that firms shouldn’t be “marking their own homework.”
If the firm that advised your transfer out of BSPS has already failed, we can help
If the firm that provided you with advice to transfer out of BSPS has already gone out of business, you may still be able to get back some of your pension pot.
Contact us here for a free, no-obligation review of your BSPS pension transfer and the advice you received and take the first step to reclaiming at least some of your lost monies.