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Another IFA pulls DB transfers after FCA review

FCA logo glass 2 620x430Advice firm Bartholomew Hawkins has stopped its defined benefit transfers following a meeting with the Financial Conduct Authority.

According to the FCA’s register the company must “immediately cease all regulated activities relating to defined benefit pension transfer business for which the firm has Part 4A permissions”.

The register says the firm ceased work on DB transfers on 22 December, which makes Bartholomew Hawkins the latest among a number of firms which have been asked to stop work on transfers during the past few months.

The advice process on DB transfers has received attention of late, particularly in the context of the British Steel Pension Scheme.

On 13 December St James’s Place said it would no longer accept transfer requests from members of the British Steel scheme.

So far the FCA has asked a number of firms to stop doing transfers for members at British Steel.

These include Active Wealth, Pembrokeshire Mortgage Centre Limited and Mansion Park.

Work and pensions committee chair Frank Field has been pressing for more information on the advice process given to BSPS members.

He wrote to two advice firm bosses called as witness but who failed to attend the committee hearing into the British Steel Pension Scheme on 13  December 2017.

These were Celtic Wealth Management managing director Clive Howells and Active Wealth director Darren Reynolds.

Field wants answers to his questions by 8 January this year when parliament returns from recess.

Bartholomew Hawkins was unavailable for comment at the time of publication.



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There are 11 comments at the moment, we would love to hear your opinion too.

  1. Wasn’t the 22nd of Dec, the date when members of the BSPS, had to make a decision to stay or transfer out ?

    Yet here we are the 2nd of Jan……. Oh look that pesky horse is out in the field “again”…..

    FCA funding …..guaranteed
    FSCS funding …..guarnteed
    FOS funding ……guaranteed
    Bonuses, pay rise, employee benefits, sick pay, pensions and Christmas parties for all of the above “GUARANTEED”

    Stable door ? Nnnnaaaa we don’t give a stuff about stable doors, we have the above, we don’t pay we demand.

    • At the National PFS meeting I spoke to the FCA and they encouraged advisers to report other Financial Advisers whose practices were potentially going to create bad outcomes for clients and the good financial advisers (i.e. as the good ones pay for the mistakes of the bad ones). I told the FCA that they should be banging the drum about how to do this. There are other areas of advice that also need reporting especially when you read that ‘dodgy’ non regulated advice comes back to bite the profession if the advice was given by a regulated adviser. WE ALL NEED TO MAKE THIS A PROPER PROFESSION!

  2. Does anyone know how many firms that the FCA has visited HAVEN’T been instructed to cease transacting the class of business?

    I may be wrong but I rather suspect that the answer is none.

  3. Christopher Petrie 2nd January 2018 at 4:45 pm

    No, British Steel have extended the date for their members to make a decision.

    The FCA are correct in continuing to be pro-active in this matter.

    • Does this really make a difference ?

      Or is it, too little to late ?

      Either way some one else can sweep up the mess

      Megan Butler said not so long back DB transfers are front and center of my mind … sh1t Sherlock…. the time to take this size 5 from your arse was 12 months ago …. here we go 2018 ….and now it’s a Jacques Cousteau,s flippers…. sideways ….

      As soon as there is a time bar on anything …..common sense leads one to believe the vultures will circle …fill your boots and wait to be caught …like the horse in the field

      Extended or not the damage has been done ….I call that reactive not proactive….

  4. On the face of it there appears to be a systemic issue with DB transfers. If that’s the case it seems unlikely it can be effectively dealt with by individual visits and cessation orders.

    Two choices for regulators and politicians then.

    Act across the board to clamp down on DB transfers with the risk of denying legitimate transfers and reducing the availability of legally required advice (not to mention the attached negative publicity).

    Alternatively, give the impression of action but in reality procrastinate and wait knowing that there was a fall guy who could take the blame, pick up the bill, and wear the publicity as and when required.

    No brainer.

  5. Pension freedoms legislation has had an unintended consequence, the Government surely did not intend that members should give up secure benefits in order to provide a short term boost to the Treasury?

    I think we all know the answer to that one, Pandora’s Box is now open and the FCA cannot shut it, so why not let it run to the inevitable conclusion and blame those who had nothing to do with causing the problem.

    Greed by the Chancellor, greed by some advisers and greed by the members, you cannot change human nature.

    As some commentators have mentioned, this will close the door to legitimate transfers, potentially opening another line of complaint if transferring was proved to be the right thing to do.

    • In the absence of any evidence that the primary objective of members of DBP schemes transferring to PP’s is so they can draw from them unsustainable levels of regular income or, worse still, plunder them on an ad hoc basis, this may be getting slightly off the point.

  6. The issue with the advice market is:

    1) The barrier to entry for an adviser to give DB advice is set too low.

    Post pension freedoms advisers with no occupational pension experience, who barely understood the pre freedoms landscape, scrapped through one exam and flooded the DB advice market ill equipped but greedy for an asset grab, as self proclaimed experts not worth their over inflated fees.

    2) Many advisers only see a transfer as being a positive outcome. Typically this is due to a transfer providing the opportunity for a fat placement fee (contingent basis) and the AUM. I.e is what best for adviser, client outcome is secondary.

    3) As per the comments sections when articles appear within industry press such as Money Marketing around COBS guidance/rules on transfers being updated; far too many advisers want the regulator to tell them how to give advice…if any adviser needs the FCA to hold their hand in building a robust, member focused holistic advice process with scientific sustainability modelling for occupational pension reviews, they simply should not be advising on it.

    Fix above, and the advice market will have hope.

    Occupational pension advice is a specialist area, and sadly at present there are too many amateurs in a professional field.

  7. DB Transfers should ONLY be advised on by a 3rd party. i.e. Outsourced.

    It has to be a ‘conflict of interest’ if the person/company that is giving the ‘advice’ is the same company that will benefit from the annual ongoing fee when a transfer is recommended. Surely?

    • I think the normal should be the pension transfer specialist is not client facing. The adviser dealing with the client cannot be impartial as their will be a degree of un-intentional bias.

      In contrast, there should be no reason why any firm cannot hire an individual with the remit of being impartial. This protects the client and the firm.

      The outsourced approach? Well a fair few of these have lost their permissions recently so perhaps not the best model.

      Plus for commercial reasons, the outsourced party would:

      1) Need to be FCA authorised and pay FCA fees
      2) Would need to pay annual PI
      3) Would have no control over the end investment; or how those funds are managed, or how the retirement strategy is handled…so, outsourced delivers advice, passed back to adviser who is incompetent and mis-manages investments/retirement strategy…who is on the hook??? simple, the outsourced party.

      I can’t imagine thats an attractive model.

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