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IFAs slam PIA watchdog over pensions redress

IFAs have slammed the PIA ombudsman for encouraging policyholders seeking redress over pension misselling to complain in order to validate any offer they have received.

A Rochdale IFA is fuming after a client was advised by the ombudsman that the “only way” to verify an offer of compensation was to make a formal complaint against the adviser.

The client asked for redress last December after claiming she would have been better off joining her employer&#39s scheme than taking out a personal pension with Norwich Union.

Although the IFA claims he advised her to join the company scheme, under PIA rules, he offered redress of around 10 times what had been paid into the personal scheme.

Despite this, the client wanted to validate the offer and contacted the FSA for guidance. The regulator advised talking to the PIAOB which seem- ingly told the client to complain although the IFA claims the client had no intention of previously doing so.

The IFA will now have to pay£500 for the PIAOB to investigate the case.

Klonowski & Co principal Francis Klonowski says: “Complaints have gone beyond a stage which we can control. An IFA could have been acting perfectly ethically and properly but can be called to task over one little chink. What we need is a high-profile case where in these sorts of situations the client loses and loses badly.”

Millbrae Financial Services managing director Carl Melvin says: “I think it is outrageous that the PIAOB has suggested that. It is not there to condemn the IFA and should be more even-handed. This is a regulator at its worst.”

Financial Ombudsman Service head of communications David Cresswell says: “It is always going to be a consumer&#39s prerogative to make a complaint.”

Skipton Building Society is launching a new tracker mortgage that uses the three-month US dollar Libor rate as a benchmark which has been lower historically than the three-month sterling Libor. The starting rate for the loan is 4.89 per cent – 3.9 per cent USDL plus 0.99 per cent. It will be reviewed every quarter and adjusted as the USDL changes. There is a redemption charge of 5 per cent on the balance for the first five years.

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