New data has shed light on how many defined benefit pension transfers have been conducted by advice firms that have since left the market.
Nineteen firms have either had their permissions to conduct DB transfer advice removed by the FCA or have surrendered their authorisations since 2015.
According to the Financial Times, these have been responsible for nearly 5,000 transfers, as the FCA tells the paper that between them the firms that have since exited the market arranged 4,659 transfers.
In its most recent file review, the FCA found that less than half the transfer advice it assessed from a separate set of firms was suitable, meaning that thousands of transfers from the firms who have had their permissions removed could have put consumers at risk.
The volume of transfers carried out by the firms in that file review suggests numbers have increased significantly too. In December, the FCA published findings of a review of 18 firms who between the had arranged 24,919 pension transfers.
The Finanical Inclusion Centre co-founder and former FCA board member Mick McAteer tells the Financial Times: “The FCA should be requiring these businesses, where it had the most serious concerns, to write to their customers to alert them about the FCA’s involvement. This is such a serious issue because the potential impact on an individual of being wrongly advised to transfer their DB pension is much greater than being mis-sold payment protection insurance or an endowment, because of the huge sums involved.”