Adviser fined £1.3m after pension transfer failures

dunstonh

Bravepants said:

I would not be surprised if that's now the end of DB transfers.

Surely no advisor will touch them with a barge pole from now on?

The FCA does not appear to have any problem with DB transfers and how they were being done before the factory line companies set up and how they are being done again currently.       Unfortunately, some opportunistic chancers saw the CETVs and customer desires as a way to earn themselves extra money.

Remember that a more typical adviser with PTS permissions probably only does a handful of DB transfers a year, if that.    The issues all seem to be from the firms that did hundreds, thousands or tens of thousands. 

According to the FCA notice, he did 422 DB transfers.  That is an astonishingly high figure for one individual adviser.  My personal view is that the FCA should look at the numbers of DB transfers done by the firm and the number of PTS advisers it has and if the ratio is above a certain number, they should proactively check that firm.

I notice that the firm is in liquidation.  So, as usual, it will be the majority of decent, ethical and compliant firms that foot the bill.

It is also ironic, that the firm in this action is exactly the type that many of the posters on this site that wanted a DB transfer (or still do) were looking for.

bostonerimus

I heard Prof. Atul Shah on Radio 4 today and he has a pretty jaundiced opinion of the UK financial industry and the general way that people deal with their finances, particularly the amount of debt. His thoughts align pretty well with mine and I'm glad that I have never felt the need to employ a financial advisor. 

https://www.bbc.co.uk/sounds/play/m000yldz

Malthusian

bostonerimus said:

I heard Prof. Atul Shah on Radio 4 today and he has a pretty jaundiced opinion of the UK financial industry and the general way that people deal with their finances, particularly the amount of debt. His thoughts align pretty well with mine and I'm glad that I have never felt the need to employ a financial advisor. 

https://www.bbc.co.uk/sounds/play/m000yldz

You might have to give us more to go on than a BBC login page if you wanted that to be a debating point. People in large amounts of net debt tend not to employ a financial adviser, as people usually don't need regulated advice to tell them how to invest their no money. (Net debt is distinct from secured debt like mortgages, where advisers often are involved, but people lending you lots of money to buy valuable assets that usually return more than you pay in interest is a good thing, so presumably not what the prof was mithering about.)

dunstonh

bostonerimus said:

I heard Prof. Atul Shah on Radio 4 today and he has a pretty jaundiced opinion of the UK financial industry and the general way that people deal with their finances, particularly the amount of debt. His thoughts align pretty well with mine and I'm glad that I have never felt the need to employ a financial advisor. 

https://www.bbc.co.uk/sounds/play/m000yldz

Are you suggesting he has criticised investment class advisers in the way they deal with people in debt?  (when it is debt counsellors that would do that role)   Or is it just you linking investment advice with debt counselling?

Thrugelmir

bostonerimus said:

I heard Prof. Atul Shah on Radio 4 today and he has a pretty jaundiced opinion of the UK financial industry and the general way that people deal with their finances, particularly the amount of debt. His thoughts align pretty well with mine and I'm glad that I have never felt the need to employ a financial advisor. 

https://www.bbc.co.uk/sounds/play/m000yldz

Is the US finance industry any better?  Why the need to post negatively about the UK when you left 30 years ago. 

[Deleted User]

bostonerimus said:

I heard Prof. Atul Shah on Radio 4 today and he has a pretty jaundiced opinion of the UK financial industry and the general way that people deal with their finances, particularly the amount of debt. His thoughts align pretty well with mine and I'm glad that I have never felt the need to employ a financial advisor. 

https://www.bbc.co.uk/sounds/play/m000yldz

I couldn’t get passed Professor’s claim that shareholder capitalism is “unethical”. And his field is financial education?  Thats like giving responsibility for teaching chemistry to an alchemist. BBC is weird.  Glad I don’t have to pay for it. 

bostonerimus

Thrugelmir said:

bostonerimus said:

I heard Prof. Atul Shah on Radio 4 today and he has a pretty jaundiced opinion of the UK financial industry and the general way that people deal with their finances, particularly the amount of debt. His thoughts align pretty well with mine and I'm glad that I have never felt the need to employ a financial advisor. 

https://www.bbc.co.uk/sounds/play/m000yldz

Is the US finance industry any better?  Why the need to post negatively about the UK when you left 30 years ago. 

I thought it was interesting and relevant. I have similar opinions about many aspects of the US financial industry. I don't really see why the fact that I left the UK 30 years ago should prevent me from commenting about the UK from my perspective. It might be different, but that might also be useful.

Diplodicus

Unwarranted pile on to bostonerimus imo, particularly if you haven't listened to the link.

I don't expect representatives of the financial services industry to act "ethically;" they take no hipppocratic oath, after all.

Equally, I don't buy the idea that "good" and "bad" are the two types of (I)FA (with a tiny minority of "bad" ones being responsible for all the trouble).

If there are two types (I)FA, imo, they are the greedy and the fearful. But, being human, each is a mixture of the two, to varying degrees. If you use an (I)FA -particularly if you have to use an (I)FA - I believe the expectation that the (I)FA will act in their own interest will save the client much future disappointment. 

dunstonh

I don't expect representatives of the financial services industry to act "ethically;" they take no hipppocratic oath, after all.

Why would a medical oath have anything to do with financial services?    

Equally, I don't buy the idea that "good" and "bad" are the two types of (I)FA (with a tiny minority of "bad" ones being responsible for all the trouble).
If there are two types (I)FA, imo, they are the greedy and the fearful. But, being human, each is a mixture of the two, to varying degrees. If you use an (I)FA -particularly if you have to use an (I)FA - I believe the expectation that the (I)FA will act in their own interest will save the client much future disappointment. 

We know you have a biased jaded view but this is just silly.    

It is also somewhat ironic that your criticism of ethics is based on the fact that an IFA or FA will not transfer your pension when they do not feel it is in your best interests.   

Diplodicus

dunstonh said:

I don't expect representatives of the financial services industry to act "ethically;" they take no hipppocratic oath, after all.

Why would a medical oath have anything to do with financial services?    

Equally, I don't buy the idea that "good" and "bad" are the two types of (I)FA (with a tiny minority of "bad" ones being responsible for all the trouble).
If there are two types (I)FA, imo, they are the greedy and the fearful. But, being human, each is a mixture of the two, to varying degrees. If you use an (I)FA -particularly if you have to use an (I)FA - I believe the expectation that the (I)FA will act in their own interest will save the client much future disappointment. 

We know you have a biased jaded view but this is just silly.    

Everybody has a biased view. As someone posting from the pov of a financial adviser, you have a biased view, dunstonh.

Imo, self interest is like gravity: it governs everything. 

You realise, don't you, that Geoffrey Armin was based in Derbyshire, far away from most of the British Steel pensioners?
You must know that most transferees were introduced to him by another financial adviser?
You realise that the ongoing kickbacks mentioned upthread (£6,000 for every year each worker stayed with the new investment) didn't go to Armin but the (I)FA who used him as a conduit?

I'm saying (I)FAs are neither saints nor sinners but the same as everybody else:- self interested.