An industrial town in deepest South Wales may seem an unlikely location for a high-profile conference, until you fully grasp the magnitude of what has happened there over the past 12 months and its impact on the planning profession.
While the scheme’s future had looked unsure for a while beforehand, this time six months ago, decision day had just passed for British Steel Pension Scheme members. They were forced to choose between a number of scary-sounding options: stay and take a cut to your benefits in the Pension Protection Fund; move to British Steel’s new scheme and likely take a cut; or transfer out entirely.
It is true that some steelworkers showed particularly low levels of financial literacy, for example in thinking that their £20,000 (a year) benefits, say, were only worth £20,000. But many did pay attention, and did thoroughly read the paperwork that was presented to them.
The FCA has very limited powers to investigate and sanction firms that do not hold permissions with it
The reason many in this latter group transferred was down to the role played by unregulated introducer firms, whose sole goal was to generate leads for authorised pension transfer specialist advisers, and be paid handsomely for the privilege.
The Port Talbot conference last week crystallised a lot of what we already knew had gone on: factory-gating; offers of sausage and chip suppers in exchange for your time; targeting the foremen, who the unscrupulous knew would be followed by the rank and file staff into a defined benefit transfer.
This is all perfectly within the rules as they stand.
So long as an unauthorised firm does not purport to give regulated financial advice, it is more than within its rights to sell client banks to advisers.
In fact, many reputable advisers I know do rely on introducers for a steady stream of high-quality leads. The problem becomes when these introducers have fingers in other pies, such as the underlying funds or discretionary fund managers used.
Again, this is not illegal if they are not actually giving advice, but it does raise significant conflicts in the case of British Steel that I am sure we are all yet to get to the bottom of.
That is a story for another day. As is what to do about this from a regulatory perspective, given that the FCA has very limited powers to investigate and sanction firms that do not hold permissions with it.
For now, we can just applaud the work of those who organised the latest Port Talbot meet-up, who have given up their free time since the scandal emerged, and hope that we take at least some lessons away from those hurt in the process.
Justin Cash is editor of Money Marketing. Follow him on Twitter @Justin_Cash_1