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FSA warns IFAs that promotions are trivialising pension unlocking

The FSA is warning IFAs specialising in unlocking pensions at 50 that their marketing campaigns are unbalanced.

The regulator is writing to firms to express concerns that TV and press campaigns do not adequately describe the risks involved and the long-term effects of a reduction in pension income.

The FSA has written to senior management at around 10 firms saying the marketing of pension unlocking is emotive and light-hearted, with the effect of persuading consumers that the decision to unlock their pension is trivial.

It says firms found to have exposed customers to misleading promotions or inappropriate advice on unlocking will face enforcement action.

Director of investment firms David Kenmir says: “Releasing cash may sound very tempting but people need to stop and think about whether they really need to do it. It is rarely in anyone&#39s long-term financial interest. Only in exceptional cases, where people have immediate needs and no other option, should they even consider doing it.”

Hornbuckle Mitchell Group director Viv Belcher says: “I have been surprised that the advertisements have carried on in the way they have but people will be tempted out of desperation. There will be situations where it is appropriate for high-net-worth individuals who get face-to-face advice but for people doing it through the post it seems too easy.”


Keir is joining Swip in UK equities investment role

Scottish Widows Investment Partnership has appointed David Keir as investment director UK equities. Keir is a chartered accountant and joins Swip from Edinburgh Fund Managers where he has been investment manager covering UK equities. He will take charge of retail and institutional business, including research, replacing Graham Campbell who left the firm to set up […]

&#39Reviewable rates may lead to unfair contract claims&#39

The Financial Ombudsman Service is telling insurers to tread carefully on reviewable rate products such as critical illness to ensure they do not breach the unfair contract rules. Principal ombudsman Tony Boorman says he has raised the issue to generate debate but the FOS has no official policy in the area and has not received […]

Pathways maps out a career structure

A career development programme for professionalism in financial services has launched with industrywide support. The Pathways initiative has received the backing of Norwich Union, Zurich and Aegon, IFAs Momentum and Simply Biz and industry bodies Aifa, the Financial Services Skills Council, the LIA, Sofa and CII. The purpose is to encourage and retain graduates and […]

Millfield cuts loss by 4.5 per cent

National IFA Millfield Group&#39s losses have fallen 4.5 per cent to £5.6m in the six months to September 2003, from £5.9m for the same period last year. The Aim-listed firm saw turnover for the period increase 65 per cent to £23.5m for the six months to September 2003, from £14.2m for the same period in […]

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What price (more) freedoms?

George Osborne will make his last Budget speech of the current parliamentary term this week, and the early media briefings suggest that pensions will again feature heavily in that statement. So what are we able to learn from the weekend’s coverage?


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