A letter from a senior Financial Conduct Authority (FCA) director has revealed the regulator has visited 16 firms to review British Steel Pension Scheme (BSPS) client files.
In a letter sent to Work and Pensions Select Committee chair Frank Field, FCA executive director of strategy and competition Christopher Woolard offered a glimpse into the watchdog's role in regulating advisers with BSPS clients.
As well as visiting 16 firms, Woolard said the FCA had identified firms that were particularly active in the relevant areas and had asked for details of their business models.
Where the regulator found failings in the advice provided by the firms, he added, it had taken action - including asking firms to stop providing further advice until they had made changes to their business models.
Woolard added that the FCA was engaged in wider supervisory work where it was communicating with firms known to have advised BSPS members.
In the letter, he confirmed the FCA had held two seminars in South Wales and a further two in Doncaster. Around 200 local regulated advisers attended these sessions and the FCA then wrote to all regulated advisers in the local area to reaffirm its expectations.
On 13 December, the Work and Pensions Select Committee will hear evidence on defined benefit (DB) transfers out of the BSPS scheme from people close to the issue.
Among these is Echelon Wealthcare managing director Alistair Rush who has set up Operation CHIVE - a pro bono initiative that will see advisers and industry professionals give free guidance to those affected by the collapse of the BSPS.
'Consumer's best interests'
In his letter, Woolard set out the FCA's view on transferring out of a DB pension: "To be clear, our position is that transferring a pension out of a defined benefit scheme is unlikely to be in a consumer's best interests," he said.
"Any regulated adviser providing such advice needs to ensure they have sufficient, well-evidenced reasons for doing so that meet our rules and requirements."
He continued: "We have been made aware of reports that some regulated advisers have been targeting BSPS members and providing poor advice on transferring from their DB scheme into a defined contribution scheme or other investment. As such, we have sought to intervene to remind all regulated advisers of our clear and firm expectation of them by holding seminars and writing to all regulated pension transfer advisers in the affected areas."
British steelworkers have until 22 December to decide whether to move their DB pension pots into a new plan that is being created, or stay in the current fund, which will be moved into the Pension Protection Fund.
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