Non-advised brokers have been barred entry to the Money Advice Service’s retirement adviser directory, leaving them at the mercy of pension scammers, Hargreaves Lansdown warns.
Registration to the directory, which will be given to users of the Government-backed guidance service Pension Wise, opens today but will not point customers to firms that offer retirement products without going through a regulated adviser.
Hargreaves Lansdown head of pension research Tom McPhail says the directory’s omission will leave thousands of “middle market” customers at risk of pension scams.
He says: “There’s Pension Wise at one end, and full advice at the other end. But what a lot of people want is a bit of help in the big, broad spectrum in the middle. They don’t want to pay for advice but they want a bit more help than Pension Wise. They want a broker to help them with a retirement process,.
“My concern with MAS’s direction of travel has always been the directory will only present people with a full, fat advisory solution.
“The critical problem is people need to be helped to act safely, without the need to go to full regulated advice. Otherwise, there’s a vacuum for the fraudsters to fill.”
Advisers will only be permitted entry to the directory as long as they are “active” in the retirement planning market and can provide regulated advice for “either” at or post retirement. They will have to specify whether they focus on one market over the other.
Initially, the MAS proposed firms would only be included if they were retirement specialists.
Advisers will need to offer personal recommendations as part of their “primary business model”. This can be “full, focused or simplified advice” says the MAS.
Both independent and restricted firms that have chosen to focus on retirement “relevant” markets will be included in the directory, but restricted advisers will have to agree to focus on a “wide range of providers within the market”.
MAS chief executive Caroline Rookes says: “The Money Advice Service’s directory is open for business. As the Government’s pension reforms are implemented, it is really important that consumers in every part of the country know where to turn to find a specialist retirement adviser who can help with their individual circumstances at a very crucial time in their lives.
“We hope that advisers who meet the entry criteria from right across the UK sign up to be listed on the directory – especially now that Pension Wise will be signposting consumers looking for regulated advice to the directory.”
Advisers can register for the directory here.