The method for calculating pension transfer redress following unsuitable advice looks set to be overhauled by the Financial Conduct Authority (FCA) later this year.
The regulator said it intends to consult on changes to current methodology in the autumn. Pension transfer advice is needed when a client wishes to leave a defined benefit (DB) scheme - which provides guaranteed retirement income - to transfer into a personal pension scheme. If the advice is later found to have been unsuitable clients are often left in a worse financial position due to the transfer. The FCA said the current redress methodology used by the industry and Financial Ombudsman Service was originally developed for the Pensions Review of the 1990s. It explained it is intended...
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