SIPP pension mis-sold?

Norfolk_Norris

Hello

I am new to this website, and really hope someone can give me a bit of advice.

Basically, I feel very strongly that I was mis-sold a pension transfer; transferring a stakeholder pension into a SIPP.

I think the easiest way to explain, is in bullet-poiint format.

I'll set the scene, back in 2010:

• I owed an IFA a sum of money (on a private, unlinked basis)
• He chased me for this money for a number of days/weeks, but I was, at the time unable to pay him in one go
• Finally, he asked if I had any pensions or investments. He suggested I let him move a stakeholder pension I had, taking the comission as a means to pay him off the money I owed him
• At the time, I had a stakeholder with apprx £20k and a frozen employer pension also worth approx £20k
• I only "allowed" him to move the stakeholder to a SIPP pension so that he could take what I owed him from the commission, and stop chasing me for ££. He did continue to hassle me to also transfer the employer pension, but thankfully I did not do allow this

• The fund in to which the money was transfered turned out to be an extremely high risk fund. I was not made aware of the fact it was extremely high risk at the time, nor the fact it was an unregualted fund
• The company that held the fund, have since been investigated by the serious fraud office (SFO) , the company assets ceased and the funds basically lost.
• I feel that it was completely innapropriate to be advised to transfer 50% of my entire pension pot(s) to such a high risk and unregualted fund; the only information given was that it would give excellent returns and that it was run by a "green company", plus I would no longer owe the IFA any money for the debt between him and me

I have since started to collect evidence and one item I now have a copy of is the application form made by the IFA to transfer the pension.

One alarming fact is that he is not the named IFA on the application. He (X) gave the "advice", but has then forwarded the application to a different IFA (Y) of another company, who has put his name to the advice.

(Y) Claiming I saw him 'face to face' and that 'advice was received from (Y)" - I have signed this form, and can only think that (Y) later completed and signed his part. (Y) was absolutely not present during the meeting, (X) being the one whom I owed some money to and the one who advised me to move the pension

As far as I was and still am concered, the person I actually saw for the advice (X) was and still is registered with the FSA/FCA. Whether this was or is with authority for pension advice remains to be seen.

I am familar with the "other guy" (Y) and know that he was and still is also registered and 'above board'.

So, in a nutshell I feel i was forced into moving my pension because of money owed to the IFA I saw for the advice; I feel that the funds were transferred to a grossly innapropriate fund and now I feel something is further amiss due to the fact that the application stating a different IFA / company gave thwe advice.

I have already approached the ombudsman and they have duly written to the company who are seen to be the one's who advised me to move the pension (although it wasn't actually them that did).

I have also forward a letter of complaint to the network underwhich the actual advisor I saw was registered, only to be told that although they agree he was registered with them at the time the advice was given, the pension transfer was not submitted via them.

Apologies for the confusing manner in which I have tried to tell the story; Any opinions would be greatly appreciated.

Many thanks
Norris

dunstonh

One alarming fact is that he is not the named IFA on the application. He (X) gave the "advice", but has then forwarded the application to a different IFA (Y) of another company, who has put his name to the advice.

Not at all uncommon. Factfinding etc does not need to be done by the IFA signing off on the transaction. I myself have signed off advice on clients of another company IFA and had another IFA sign off my clients advice. Nothing to be alarmed about there. However, it should be clear who is giving the advice.

It should also be noted that it can be used incorrectly by some scams/dodgy schemes who get an IFA to set up the pension and doing the pension due diligence but not the advice on the investments within the SIPP. The IFA can be duped as much as you can be as they are told you are self investing (which is what the SI stands for in SIPP) and is never told what it is really investing into. Once set up, the unregulated/dodgy firm handles the investments without the IFA knowing. The compliance company I use have issued warnings to IFAs to avoid this relationship and always make sure the investments are known and suitable. A recent case in court found the IFA was not guilty of the actions of the third party but that is not to say that would always be the case.

I have also forward a letter of complaint to the network underwhich the actual advisor I saw was registered, only to be told that although they agree he was registered with them at the time the advice was given, the pension transfer was not submitted via them.

This is key. When the application is submitted, it is done via an agency belonging to the IFA. It is that IFA that carries the liability. So, whilst he may have written the report etc, if the business didnt go through his agency but went through another then it is that other that carries the liability for complaint.

Unregulated schemes are generally classed as high risk and unsuitable for the average consumer. So, you have grounds for complaint and your story is the sort I really hate as the vast majority of IFAs would just cringe at that.

You need to complain to whoever the business it was processed through. The SIPP provider will verify this if you are unsure.

Norfolk_Norris

Thanks for the reply dunstonh.

The SIPP provider has confirmed that the guy I did not see, and his company are responsible.

On re-checking the application, the page entitled "Financial/Professional Advisor Details" has been completed by the IFA I did not see. The handwriting does not match that on any other page and was obviously completed afterwards.

His name is on there as the "person in the firm responsible"

With "have you received advise from your advisor" ticked as YES.

So I am guessing that this is basically saying he gave the advice and is responsible for it allowing the advisor I saw to wash his hands of it all?

The actual IFA I saw is later mentioned on the applcation, but only as a witness to my signauture on the deed of appointment page.

When the scheme went bad, I received a one line email from the advisor I actually saw aksing 'have you had a letter about your pension?";showing he had a connection enough to be concerned.

I am now awaiting response from the advisor/company officially responsible and it will be very interesting to see how they respond, with him not actually being present when the advice was given?!

If it's ok, I will keep you posted on the progress and appreciate any guidance you can give.

Thanks
Norris

dunstonh

The SIPP provider has confirmed that the guy I did not see, and his company are responsible.

That is who you complain to then.

On re-checking the application, the page entitled "Financial/Professional Advisor Details" has been completed by the IFA I did not see. The handwriting does not match that on any other page and was obviously completed afterwards.

That doesnt matter. An agent, paraplanner, administrator or any third party can fill details like that in.

So I am guessing that this is basically saying he gave the advice and is responsible for it allowing the advisor I saw to wash his hands of it all?

Yes.

If it's ok, I will keep you posted on the progress and appreciate any guidance you can give.

please do. Myself and others will always try and help and, even for our own curiosity reasons, I am sure others who have read this thread but have nothing to add (probably as I left little they could add) would like to know the progress/outcomes

Norfolk_Norris

OK - further update.

Just had the IFA I didn't see on the phone, saying he didn't have a clue about what the other IFA had done for me, other than he submitted the transfer on his behalf.

He went on to say the other "IFA" was not authorised to do pension transfer advice and that he'd set up a company as a front to make it look kosher; then sending on these transfers for him to deal with. Would he really not know what had been recommended?

He asked if I would kindly inform the FOS that he wasn't responsible and that the other IFA gave the advice, and to now pursue the other guy thourgh the courts, otherwise this coiuld mean him having to close his business down.

He played a bit of a guilt trip, because I did used to know him. He was very quick to bad-mouth the guy that gave me "advise", saying he's done the same to several clients. I think he mentioned something about not being covered for this sort of thing, and that he could have to close down his business because of this.

On searching the FSA register, the guy who gave advice was registered at 2 different companies, but I am not sure in what capacity. I know he was regulated for mortgage and protection advice at one, but not sure about the other. He also had this further company name which does not appear on the register but was suggested as a financial advice company.

Thoughts ans suggestions greatly appreciated.

Kindly
Norris

dunstonh

He went on to say the other "IFA" was not authorised to do pension transfer advice and that he'd set up a company as a front to make it look kosher; then sending on these transfers for him to deal with. Would he really not know what had been recommended?

Sorry but I don't buy that.

Yes, someone could commit fraud by putting another IFA details on an application. However, how did the "bad" one get paid if the "good" one didnt know who to pay and what for?
Wouldn't the "good" IFA notice applications getting processed on his agencies?

On searching the FSA register, the guy who gave advice was registered at 2 different companies, but I am not sure in what capacity. I know he was regulated for mortgage and protection advice at one, but not sure about the other. He also had this further company name which does not appear on the register but was suggested as a financial advice company.

CF30 is financial adviser permission. If he has a current CF30 showing against him then he is an adviser. If there is no current CF30 then he is not an adviser. If there was never a CF30 then he has not been an adviser since 2007 (when CF30 replaced the old CF21). If there is not a CF21 on his history then he couldnt have been adviser since 2001 (when the FSA register started).

Norfolk_Norris

dunstonh wrote: »

Sorry but I don't buy that.

Yes, someone could commit fraud by putting another IFA details on an application. However, how did the "bad" one get paid if the "good" one didnt know who to pay and what for?
Wouldn't the "good" IFA notice applications getting processed on his agencies?

Sorry, I probably didn't expain too well - there is no question the Good IFA knew Bad IFA was using his company for the submissions.

What he said was he wasn't aware that Bad IFA was recommending this particular high risk fund; basically saying what ever this guy was advising was unknown, unyet he allowed the use of his company to submit business.

I get the feeling he must have known, or at least been able to check, seeing as it was his name going down as the advisor?

I have looked on the FSA register again, and under the history of Bad IFA, headed 'controlled functions' - CF30 Customer xxx company ltd 2010-2011

I know that xxx company was not Bad IFA's company, but assume he had some sort of connection.

I'm not sure if the 'CF30 Customer' means he was CF30 between 2010 - 2011 or if the company under 'firm name' was CF30.

Even if he was CF30 when he gave me the advice, I assume the submission company are still the ones 'responible'?

Thanks much
Norris

dunstonh

What he said was he wasn't aware that Bad IFA was recommending this particular high risk fund; basically saying what ever this guy was advising was unknown, unyet he allowed the use of his company to submit business.

Tough on that IFA. If you let another IFA process business through your firm then you carry the liability for that business.

I have looked on the FSA register again, and under the history of Bad IFA, headed 'controlled functions' - CF30 Customer xxx company ltd 2010-2011

I know that xxx company was not Bad IFA's company, but assume he had some sort of connection.

I'm not sure if the 'CF30 Customer' means he was CF30 between 2010 - 2011 or if the company under 'firm name' was CF30.

Even if he was CF30 when he gave me the advice, I assume the submission company are still the ones 'responible'?

It means that he was an adviser between 2010 and 2011 at xxx company. CF30 customer is the term for stockbrokers and investment class advisers. You complain to the company the business was processed through. Although it may be worth copying the complaint and sending it to the company that he is showing CF30 against as well. Take a dual approach as his authorisations and regulatory requirements were handled by xxx company limited where he shows as CF30.

jamesd

Norfolk_Norris wrote: »

He asked if I would kindly inform the FOS that he wasn't responsible and that the other IFA gave the advice, and to now pursue the other guy thourgh the courts, otherwise this coiuld mean him having to close his business down.

No, you should not kindly do that. As dunstonh wrote, he is liable for the business he carries out.

Part of the job of IFAs is to protect their customers. You are his customer and he failed to do that.

Norfolk_Norris wrote: »

He played a bit of a guilt trip, because I did used to know him. He was very quick to bad-mouth the guy that gave me "advise", saying he's done the same to several clients.

Then he had prior notice that he was engaging in business with an unreputable party who should not be trusted, meaning that he would have to take responsibility for ensuring that all transactions he carried out were proper.

That's further evidence of poor conduct on his part.

Norfolk_Norris wrote: »

I think he mentioned something about not being covered for this sort of thing, and that he could have to close down his business because of this.

I thought that such cover was mandatory for IFAs. But perhaps not, maybe dunstonh might like to confirm or deny.

The person who processed the business knew he was dealing with a dodgy character but still let the shark cheat you. That is not something that should inspire kindly feelings in your heart. It should inspire a desire to get him reminded by proper authorities of his obligations to his clients.

If the amount is substantial you may wish to consider helping the IFA who processed the business by offering him secured regular payments of redress - totalling the whole amount lost plus interest -to you so that his business is not immediately threatened. Or not, since it increases your risk and you already know he's not acting as he should. Secured perhaps on his property or other goods so that if he fails you can take payment that way, since he also seems to have effectively disclosed that his business is in financial difficulty.

It's good to help him keep his business, but do remember that you have to protect yourself. If his business did fail beacause of his redress obligation to you, the FSCS would end up being the paying party.

Norfolk_Norris

Thanks jamesd & dunstonh for the eye opening replies.

The ways its been left with 'Good IFA' is that he is expecting to be copied in on an email from me to the FOS, negating him from blame and placing it firmly at the door of Bad IFA

As you rightly point out, had 'good IFA' vetted what he was putting his name to, and had then, the same 'shock-horror' reaction to what 'bad IFA' recommended, as he did today, he surely would not have allowed and submitted the transfer?!

Asking me to chase the other IFA via the courts is a bit rich also - I guess my response should be, YOU chase him through the courts...

I think what Good IFA was saying about Bad IFA was that since 2010, he has had several complaints revolving around the same issue, from other clients. He mentioned that should this complaint be escalted to the FOS, it would cost him £500.

The FOS pointed out that this would suggest he has reached their £free complaint investigation limit, and that now he must be being charged for any new complaints.

I am currently awaiting the co,mission paid breakdown to see who actually officially benfitted; I'm sure commission would have been passed on to Bad IFA, albeit not officially...

doughnutmachine

I'm so glad I don't have an IFA. I thought they were meant to make life easier.