Pension Help and Advice

paulr111

Back in 2015 my sister was moving home and approached a mortgage advisor she had used in the past. The house move was fine
The advisor a NON regulated (not an IFA) somehow explored her pension position. She had a local authority final salary pension and within months the fund was transferred out
The sum transferred out was £15.540.90 the new pension provider only invested £12,200. I have been in contact with the advisor he claims that he gave NO advice so is not responsible for her current situation. The Pension fund she moved too failed soon after she invested called Incartus Investments Pension. Dalriada Trustees Ltd have been appointed by the pension authorities to recover as much as they can of the invested funds
I have spoken to and emailed the advisor and on the basis he gave no advice and the firm he worked for at the time has failed he has now asked that I direct any future contact though his solicitor (he has provided me with those contact details)
I have recently learned that as the pension pot was below £30k a requirement of a professional IFA is not required so appears to fall though the cracks I have tried The Pension Advisory service the pension regulator and the Ombudsman all of which are able to help to get my sister back into a reasonable position with her pension
I am willing to pursue the advisor but he is confident that he has done nothing wrong so I am a bit stuck as to which way to turn
Not sure why a £30k pension pot falls outside any protection for the consumer when a pension is future retirement income which is in my mind as good as lost
I am a bit shocked that over 20% of the pension pot must have been taken as a commission when no advice was given!!

Any help or advice from the forum would be great  
  

Marcon

paulr111 said:

Back in 2015 my sister was moving home and approached a mortgage advisor she had used in the past. The house move was fine
The advisor a NON regulated (not an IFA) somehow explored her pension position. She had a local authority final salary pension and within months the fund was transferred out
The sum transferred out was £15.540.90 the new pension provider only invested £12,200. I have been in contact with the advisor he claims that he gave NO advice so is not responsible for her current situation. The Pension fund she moved too failed soon after she invested called Incartus Investments Pension. Dalriada Trustees Ltd have been appointed by the pension authorities to recover as much as they can of the invested funds
I have spoken to and emailed the advisor and on the basis he gave no advice and the firm he worked for at the time has failed he has now asked that I direct any future contact though his solicitor (he has provided me with those contact details)
I have recently learned that as the pension pot was below £30k a requirement of a professional IFA is not required so appears to fall though the cracks I have tried The Pension Advisory service the pension regulator and the Ombudsman all of which are able to help to get my sister back into a reasonable position with her pension
I am willing to pursue the advisor but he is confident that he has done nothing wrong so I am a bit stuck as to which way to turn
Not sure why a £30k pension pot falls outside any protection for the consumer when a pension is future retirement income which is in my mind as good as lost
I am a bit shocked that over 20% of the pension pot must have been taken as a commission when no advice was given!!

Any help or advice from the forum would be great  
  

I presume you mean that TPAS, the Regulator and the Ombudsman have been unable to help.

The £30K figure is important only because it is the level at which someone transferring out of a DB scheme must receive (although not necessarily follow) advice from a suitably authorised and regulated individual before any transfer can proceed to another scheme where a member can 'flexibly access' their benefits.

Unless your sister has written evidence that the mortgage advisor gave advice on her pension - and I presume that isn't the case, given TPAS etc can't help - it is difficult to see that you have any chance of success if you 'pursue' the advisor via his solicitor/the courts. Does she have any written explanation of what the transfer would cost her?

If the answer to the above is 'no', then you may be throwing good money after bad by trying to pursue the adviser.

Presumably you are following developments in relation to Incartus: https://www.dalriadatrustees.co.uk/wp-content/uploads/2020/11/Incartus-Fraud-Compensation-Fund-Ruling-Announcement.pdf

TVAS

Write to the new pension provider ask who the commission was paid to?

Write a letter of complaint to FOS outlining what has happened and see what they say. Explain that the "IFA" has gone out of business. I see you have already done this.

There is a chance that you may be referred to the FSCS for compensation. 

This is a classic case of being advised by someone not able to give advice, somebody was authorised to give advice, you still need permission for a DB transfer irrespective of the 30k limit then you have been put into a high risk fund which is why there is little money left. The reason why you have been put into a high risk fund is because the mortgage adviser with the person who did advise took 20% commission I would expect 3% commission.   

All the information is there on the information superhighway its also on Moneybox life but people continually ignore the free information and act upon the word of an unregulated adviser. 

The only thing you can do to pursue him is a private prosecution. Expensive and the not with it for the sums involved. He did do something wrong he should not have discussed the pension at all. I would report him to the FCA whistle@fca.org.uk 

Albermarle

Not sure why a £30k pension pot falls outside any protection for the consumer when a pension is future retirement income which is in my mind as good as lost

We very regularly have posters on this forum complaining bitterly that because their transfer value is over £30K , they have to go through a long winded and expensive regulated process. They complain that it is their money , they know what they are doing , nanny state etc , why can't they just have it etc . £30K is such a low threshold , I don't need protecting etc etc

So the other side of the story.....

Marcon

TVAS said:

There is a chance that you may be referred to the FSCS for compensation. 

He did do something wrong he should not have discussed the pension at all. I would report him to the FCA whistle@fca.org.uk 

Unfortunately there isn't if, as OP has said, this was a non-regulated 'adviser'. The FSCS does not cover non-authorised advisers.

There is nothing at all to stop anyone 'discussing' pensions, provided they do not purport to give advice. Reporting a non-regulated adviser who worked for a firm which is now bust, and where there is no evidence that they gave written advice, is going to be an exercise  in frustration.

paulr111

Thanks for the replies all helpful comments confirming that I have little chance pursuing the advisor
sorry re my typo the Pension bodies appear to be "unable to help"
Dalriada Trustees Ltd are doing there best to unwind the funds for the benefit of the members so she will get something back 
Had she asked me back in 2015 she would still be in her finial pension scheme whilst a £15k pot would not provide a good income in retirement at least it would have been safe
I guess these things are expensive mistakes

i would represent her myself, if I could pursue the advisor but struggling to find an angle that the courts would support her on 
 

paulr111

I have already reported him to the FCA to attempt to stop him getting involved in more Pension transfers, Not sure how they go about that? 
A 20% commission does seam excessive 3% would be more realistic in my mind
I agree with the comments regarding Don't take the advisors advise on face value
I have worked recently myself with a proper pension advisor and he was very professional and transparent, I am very happy with what I did with him
   

dunstonh

A 20% commission does seam excessive 3% would be more realistic in my mind

Zero would be realistic.   Commission hasn't existed on new business since the end of 2012 on the regulated side.

Unregulated investments were used by the dodgy firms/people because they still paid a commission. Usually massive ones.  They were often paid direct as well and not via the pension provider.

There are some possibilities for action

1 - complain to the pension provider.   There have been several cases upheld in court that puts the pension provider liable if the person was an introducer to them or they knew the person was not regulated but was introducing business.

2 - Still go to the FSCS.   I have a case I put in on behalf of someone.   Similar scenario that the person was a mortgage adviser and the firm they worked for was FCA authorised.  It went to the FOS and they upheld the complaint but the firm closed to dump its liabilities.   It then had to start again via the FSCS,  Three years later, the FSCS are still considering it and obtaining information and were awaiting the outcome of a court case.

3 - pursuing the individual may be difficult.  If he was an employee of a limited company then he could say that he had no personal liability for the work he carried out as an employee (even if the employer was completely in the dark). 

paulr111

Dunstonh
Thanks for your comments very helpful

The pension provider has failed too, would I be able to file a compliant to the representative Dalriada Trustees Ltd? they I understand have been appointed by the Pension Regulator to collect in funds for the victims of the failed pension fund. I am aware that Viva Costa International (VCI) ( the unregulated firm) my sister used had introduced others to Incartus Investments Pension. The Pensions Ombudman awarded against The Police Pension Scheme on a case with a £112k pension pot  ( VCI involved an IFA to get the pension moved to Incartus case number PO-12763. The victim was reinstated by the Police Pensions to the position he should have been in prior to the transfer. Any funds from the failed pension fund will now go to the Police Pension Scheme

I have been able to contact that victim he had a court case against the same advisor but the case was dropped when he was settled by the police not sure how he managed to get a court listing and on what grounds 

I would like the FSCS to take on the case I tried online and failed on the first page when it required the IFA's details ( no IFA in this case)

My guess would be that the guy my sister used would have been self employed and a agent of the firm not an employee not sure it that makes any difference? 

Thanks for everyone trying to help me and my sister. I am wanting someone to take on the case hopefully if I write to the FSCS they will consider the case

I still struggle that unregulated firms can operate in this dangerous space and rip people off and get away with it taking a big chunk of the pot for themselves
 I am surprised the FCA  allow these people/firms to operate    

AlanP_2

I still struggle that unregulated firms can operate in this dangerous space and rip people off and get away with it taking a big chunk of the pot for themselves
 I am surprised the FCA  allow these people/firms to operate 

The FCA deal with regulated firms and individuals so be definition they can't control unregulated ones.