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Formula for confusion as pension review delay drags on

Hundreds of IFAs have been left in limbo unable to close their pension

review cases because a PIA loss-calculation blunder remains unresolved.

The ABI-backed Pension Advisers Support Scheme, which assists IFAs through

the review, has instructed 162 IFA firms to put their cases on hold since

the FSA announced it would be amending the formula on calculating redress.

IFAs face a delay at least until the summer because the regulator is

conducting research to check that the new formula is failsafe.

The formula relates to loss calculations for some transfers in phase two

of the pension review.

Pass has received calls to its helpdesk from more than 100 IFAs asking for

clarification after they were left in the dark about what to do about

transfer cases.

Their confusion has been compounded by a phrase in one of the FSA

bulletins, which the regulator has had to explain to actuaries in a letter

which went out on April 7.

The FSA says one-fifth of transfer cases could be materially affected by

the miscalculations which arose from guidance on how firms should adjust

for the change in an investor&#39s Serps entitlement after a pension transfer.

Pass review manager Derek Warner says: “The impact of bulletins 7 and 8 is

to hold back cases that could otherwise move forward to completion and


FSA spokeswoman Sarah Modlock says: “It is certainly true that there is a

hold-up in a certain category of case.”


Transfer benefits rewards skilled players

In the current financial world of super-regulation, few areas have comeunder closer scrutiny than the pension transfer market. The realitynowadays is that many pension advisers are reluctant to become involved inthe analysis of preserved pension benefits, choosing instead to focus timeand energy on other areas of expertise which they feel could be moreremunerative or less […]

Carpetbaggers cut out of windfalls

Scottish Provident has announced that buyers of second-hand policies will not be entitled to windfall payments should the insurer demutualise.The move is an attempt to block so-called “carpetbaggers” who purchase policies solely to take advantage of companies that are pursuing the conversion option.Standard Life, another insurer recently threatened with demutualisation, passed a similar resolution. It […]

Top posts are filled at mega firm CGNU

The first raft of appointments to the mega insurer CGNU&#39s UK life businesshas seen four CGU and two Norwich Union people appointed to seniorpositions.Sales and marketing director of the UK life arm will be Peter Hales. He isCGU Life sales and marketing director.NU group wealth management managing director Nick Smith will take up theequivalent position […]

What about the pension public?

Tom Kean should check his facts before putting pen to paper. Decisionsabout the extent of mortgage regulation are a matter for HM Treasury.The remainder of his comments do no favours for the majority of IFAs and,in particular, the 2,500 or so firms which are now working hard to completethe review and regain customer confidence.Mr Kean […]


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