The FCA has now written to a total of 3,591 defined benefit (DB) pension transfer advice customers this year to tell them they may be entitled to compensation.
Letters have been sent to customers of firms in liquidation where past business reviews have identified that the firm has given unsuitable advice to some customers.
The letters explain to customers that they may be entitled to compensation, setting out their options and outlining how they can make a claim to the Financial Services Compensation Scheme. The letters also direct customers to the FCA’s DB pension transfer advice checker to help them decide whether the advice they received was suitable or not.
The FCA has also published a full list of firms who are in insolvent liquidation and have given unsuitable advice to some customers. This currently covers 10 firms and this will be kept up to date as work continues.
This is part of the FCA’s work to support consumers who have received unsuitable DB transfer advice to receive appropriate compensation. The DB pension transfer advice market is particularly susceptible to consumer harm and improving this market continues to be a key area of focus for the FCA. Where harm has been caused, the FCA’s aim is to ensure that it is remedied and that consumers receive appropriate compensation.
The FCA recently published its Consumer Investments Strategy, which sets out a three year plan to address potential harm to investors. Improving outcomes for consumers transferring from DB pensions to defined contribution schemes is at the centre of this strategy.
All firms providing DB pension transfer advice should follow the FCA’s Finalised Guidance, so that they understand the processes they need to put in place to give suitable advice. The FCA will continue to monitor this market through regular data collection and its ongoing programme of supervisory work.