Former FCA technical specialist Rory Percival has launched a practical guide aimed at advisers and compliance staff at firms providing advice on defined benefit transfers.
It is available from today and takes account of the FCA’s policy statement on advising on DB transfers published in March.
The guide has three main parts with the first on FCA rules and guidance covering such issues as assessing suitability guidance and introducing the transfer value comparator.
The second section is about suitability and sets out Percival’s view on the factors that help determine whether a transfer is suitable or not.
The final section is about why additional controls for transfers are needed and suggests options and good practice ideas for firms to consider.
There are also case studies throughout to highlight suitability issues and an annex providing a series of fact-finding questions firms can use to explore the client’s objectives, priorities and their attitude to transfer risk.
Percival says: “I attended a roundtable with the regulator a couple of months ago who said there are signs some firms are not keeping good client records generally. Specifically it is finding some advisers are not keeping good records on client’s objectives for a transfer.
“I hope this guide will help firms understand the regulatory position on DB transfers, understand the key issues around suitability, and help firms put in place appropriate controls to mitigate the risk to their firms.”