Moving a pension overseas???

the_trumper

Hi All,
Hopefully there will be some of you who can give me some advice. I have a frozen pension from peugeot. It was frozen last year when peugeot made us all redundant in the uk & I have 18 years worth of contributions invested in it. We are now in the process of emigrating to New Zealand to seek a better quality of life & a healthier work / life balance. I need to know what I should do with my frozen peugeot pension - should I leave it where it is or move it to a suitable place in NZ. An added complication is that peugeot are now trying to completely "cut & run" from the UK by offering a cash bribe to everyone to leave the pension scheme & transfer to axa.
Many Thanks in advance to you all.

Cook_County

There are many companies out there specialising in transfers of pensions to NZ under the QROPS rules. I don't have a particular one to recommend but just Google search and you will find companies willing to advise. Sadly however you can't get 100% of your money back as a lump-sum as you could have done before 6 April 2006.

ifanottingham1

Hi
It is a fact that a huge scandal has occured here.
I understand that a few thousand deferred members of the Peugeot pension scheme have been bribed to transfer out of a fantastic final salary pension scheme into a far inferior personal pension scheme with Axa.
With stock markets crumbling, most members will have seen the value of their pensions plummet recently and could now face a miserable retirement.
Peugeot 'bribed' them with a cash in the hand incentive which most of the members took....and have probably by now spent!
Peugeot have really dumped all their responsibility here and believe me, the cash incentive was no where near enough to cover the loss of pension benefits.
Someone should be made to answer for this. Any members should really complain to the union, the FSA , or the local press.

dunstonh

With stock markets crumbling, most members will have seen the value of their pensions plummet recently and could now face a miserable retirement.

Two comments on that one

1 - AXA offer a range of funds low risk cash and fixed interest funds through to equity funds. So, if the people didnt want to invest in the stockmarket they didnt have to.
2 - When did it happen? We are back to 2005 levels at the moment. So, unless it happened after 2005, most people havent seen their pension plummet. Its only been a 28% drop. Lets not get carried away here, that is a typical bear market drop that you see once every 5 years or so.

Peugeot 'bribed' them with a cash in the hand incentive which most of the members took....and have probably by now spent!

So, peugeot played on the fact that they knew most of the members would go with short term greed. How the person spends it isnt up to Peugeot.

Someone should be made to answer for this. Any members should really complain to the union, the FSA , or the local press.

You cannot complain about decisions you make yourself and picking the wrong short term options.

yellowperil55

Afternoon,
I agree with the other post!
I have no doubt the advisers are all honest decent guys, the issue is not relating to their work. The issues are that the company (M2 Financial in Nottingham) was not only paid an enormous fee by Peugeot for advising the members. BUT M2 Financial also earned huge commissions for arranging the pension transfers. Hardly unbiased advice is it, when you are rewarded for encouraging the members to transfer their pensions out of a fantastic final salary pension scheme. No wonder the members were not ‘strongly’ encouraged to stay in the Peugeot scheme. The members will now be facing a less fruitful retirement since their pension funds will have crashed in value of late! Also, how many of the members do you think will genuinely understand the risks they have taken and will have carefully selected funds? I can bet most are invested largely in equities/managed funds!
Two issues for me:
1. Peugeot has truly let down its pension scheme members
2. M2 Financial should not have earned huge commissions in addition to the fees from Peugeot.
NB Apparently M2 Financial has now been sold for £15 million pounds and the two main directors have become very wealthy men, largely due to the 'success' and commissions generated from the Peugeot scandal. The rumour is that the two main directors plan to emigrate shortly before the scandal hits the press!

yellowperil55

Afternoon,
I agree with the other post!
I have no doubt the advisers are all honest decent guys, the issue is not relating to their work. The issues are that the company (M2 Financial in Nottingham) was not only paid an enormous fee by Peugeot for advising the members. BUT M2 Financial also earned huge commissions for arranging the pension transfers. Hardly unbiased advice is it, when you are rewarded for encouraging the members to transfer their pensions out of a fantastic final salary pension scheme. No wonder the members were not ‘strongly’ encouraged to stay in the Peugeot scheme. The members will now be facing a less fruitful retirement since their pension funds will have crashed in value of late! Also, how many of the members do you think will genuinely understand the risks they have taken and will have carefully selected funds? I can bet most are invested largely in equities/managed funds!
Two issues for me:
1. Peugeot has truly let down its pension scheme members
2. M2 Financial should not have earned huge commissions in addition to the fees from Peugeot.
NB Apparently M2 Financial has now been sold for £15 million pounds and the two main directors have become very wealthy men, largely due to the 'success' and commissions generated from the Peugeot scandal. The rumour is that the two main directors plan to emigrate shortly before the scandal hits the press!

dunstonh

BUT M2 Financial also earned huge commissions for arranging the pension transfers. Hardly unbiased advice is it, when you are rewarded for encouraging the members to transfer their pensions out of a fantastic final salary pension scheme.

Depends on what you mean by huge. Many incorrectly assume that the commission received is the amount that goes in the pocket.

Final salary scheme transfers are a high risk transaction. More often than no the advice is to stay put. You cannot just willy nilly recommend transfer out without a transfer analysis (TVAS) being done. The FSA would crucify a firm for doing that.

If you are paranoid enough to doubt the firm brought in by Peugeot then you can get a second opinion.

No wonder the members were not ‘strongly’ encouraged to stay in the Peugeot scheme.

If the critical yield was low and the prospects good then it can be viable if the risk profile of the individual matches.

The members will now be facing a less fruitful retirement since their pension funds will have crashed in value of late!

Why? Anyone retiring short term would probably have been told to stay put. Those that did switch and still short term would not have stockmarket exposure (unless they chose to). Long term, stockmarket exposure is normal and events like this are not uncommon (average once every 7 years).

Also, how many of the members do you think will genuinely understand the risks they have taken and will have carefully selected funds? I can bet most are invested largely in equities/managed funds!

A choice they made themselves. They could have sought advice if they wished. If you DIY then you take the responsibility.

1. Peugeot has truly let down its pension scheme members

They dont appear to have done. They have given choices and people are free to make the decision that is best for them.

2. M2 Financial should not have earned huge commissions in addition to the fees from Peugeot.

How they are remunerated is up to Peugeot. No individual was forced to use that firm and if they think they could have got cheaper elsewhere then they could have used their own advisers.

NB Apparently M2 Financial has now been sold for £15 million pounds and the two main directors have become very wealthy men, largely due to the 'success' and commissions generated from the Peugeot scandal. The rumour is that the two main directors plan to emigrate shortly before the scandal hits the press!

Good for them. If the business is compliant and correct then they have done their job as employed to do it.

EdInvestor

Have you looked into making a misselling complaint against M2 Financial?

redarmy323

Afternoon,

This is an interesting debate, and one I feel I can add to since I have some knowledge of this. I work for an insurance company and I have had dealings with M2.

Firstly, Dunstonh, you are being very defensive and there is no need to be.
The other posters are not attacking the integrity of IFAs. Indeed, I have met many of the M2 advisers and they are a decent honest bunch as are the vast majority of other IFAs that I work with.

Peugeot did offer huge cash incentives (trumper called then 'bribes') to members to transfer out of the final salary pension scheme, a scheme that offered fantastic guaranteed, index-linked pensions with widow’s benefits etc.

They transferred into a very inferior personal pension with Axa which will provide lower pensions and massively reduced benefits. Members will be getting their first annual statements as we speak and some will have lost 20-50% of their pension funds recently due to stock market falls unless they all invested in cash which is unlikely.

How can anyone agree that, ethically, that is responsible behaviour from Peugeot? Dunstonh, please don’t shock me by disagreeing with that??

Secondly, I understand that the critical yields were all very high and so transfers should not have been allowed.

Finally, had M2 been paid a fee for just offering independent advice then they would not even have been mentioned in all this. The fact is that they earned hundreds of thousands/millions of pounds from the pension transfers. Therefore they were massively incentivised for transferring the pensions - that is wrong and I cannot believe that Peugeot allowed that to happen.

dunstonh

Firstly, Dunstonh, you are being very defensive and there is no need to be.

Dont mix up putting another side to the debate as being defensive.

Peugeot did offer huge cash incentives (trumper called then 'bribes') to members to transfer out of the final salary pension scheme, a scheme that offered fantastic guaranteed, index-linked pensions with widow’s benefits etc.

Of course they did. They want people out of that scheme and they offered an incentive to do it.

ow can anyone agree that, ethically, that is responsible behaviour from Peugeot? Dunstonh, please don’t shock me by disagreeing with that??

Peugeot did nothing wrong. They offered an alternative which people could choose or not. They also had choice on the investments side as well. The alternative wasnt as good but there was choice.

Secondly, I understand that the critical yields were all very high and so transfers should not have been allowed.

If that was the case then those individuals should be considering making complaints.

Brownie_RYTON

Mr. Jean-Martin Folz (60) was elected for a 4-year term at the Annual General Meeting of May 14, 2007, replacing
Mr. Henri Hottinguer, whose term had expired at the close of this meeting. Mr. Folz was Chairman of the PSA Peugeot

Citroën Group from October 1997 to February 2007. He is currently director of Saint-Gobain and Solvay (Belgium).

Ex Chairman of PSA now works for AXA, any thoughts?