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FCA to gather data on where DB transfer money goes

The FCA will collect information about which schemes are receiving defined benefit transfers as part of its effort to monitor the market better Money Marketing can reveal.

Last December a Freedom of Information Act request from Money Marketing revealed the FCA was in the process of setting up a central database on firms involved in DB transfers.

It said this stemmed from the lessons learned in relation to the British Steel Pension Scheme and unsuitable transfer advice.

The watchdog decided a central database would allow it to “amalgamate data from a variety of sources to provide a better view on which firms are active in the market”.

Now a follow up Freedom of Information Act request from Money Marketing sheds light on the sort of information the database will be gathering.

In terms of the sources for the database, the FCA is collecting pension provider product sales data,  data from the retirement income data request introduced at the time of the pension freedoms, and transfer data from trustees.

It is also relying on intelligence gathered internally and externally, firm case work and the joint FCA/Pensions Advisory Service protocol working group.

Regarding the categories of data the FCA is interested in, the volume, value and date of transfers will be placed alongside details about the receiving scheme.

It also wants the name or reference number of the advice firms involved in transfers.

The regulator estimates it took 35 hours to set up the database. There is no specific launch date for the database, which has been in development since June 2018.

It adds both the number of staff working on the database and their time devoted to this work will vary as this will depend on the data received.

The FCA’s retail investments department is responsible for the database and no additional money has been allocated to it outside of business as usual spending.

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Comments

There are 4 comments at the moment, we would love to hear your opinion too.

  1. ..and then what?

    • They will write letters asking a few advisers to send details on a voluntary basis, then do nothing.

      Then there will be a massive mis-selling crisis, and the few rogue advisers/investment companies will have long gone, leaving the honest guys to pick up the pieces.

  2. The key issue, surely (apart from the fundamental suitability of advice to transfer anywhere), is what types of investment instruments are being recommended. Most will be straightforward, mainstream collective investment funds. The much lesser number of problem cases will be those where non-mainstream and very probably entirely unsuitable types of investment vehicles have been used.

    Apart from the chronic lateness of embarking on this information gathering exercise, the problems caused by the activities of an errant minority of advisers could have been massively reduced had the FCA many years ago mandated relevant PII cover for ALL areas of advice, particularly anything off-piste such as UCIS and the like. WHY didn’t the FCA do this? In fact, why has it STILL not done it, even now? I don’t understand what possible excuse the FCA can have for having been so dilatory about implementing such a measure.

  3. Err…..about time ?

    This should be done across the board.
    I think it vitally important that the regulator knows where money is being invested or at least have a broad knowledge.

    How many times have we seen and paid for, massive amounts of money going into single funds or places often transacted by a few people or companies.

    This is a much better use of the FCA resources, rather than running around chasing ghosts and looking for problems that really aren’t there

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