Inadvertently triggered MPAA

jamesd

With regard to how the IFA came to believe that work was ending is one of the key points so it is worth writing down any discussion of work or retirement and re-reading any reports that were provided to see what they said. It's possible that they will explain how the adviser came to their belief.

pip895

I didn’t use an IFA - just set up drawdown through Hargreaves.  I got so many warnings about the fact I was going to breach the MPAA I got sick of them.  I made several phone calls and it came up every time, I’m retired so it wasn’t an issue for me anyway.

Personally I think your adviser made a mistake, saying he thought you were retired is just an excuse. Wether you have enough evidence to prove negligence or wether the previous warnings given are enough to get them off the hook.. - I suspect they may have covered themselves unfortunately.  

Helenadviceplease

Hi, 
So my IFA finally admitted they were wrong. They want to meet to work out a settlement figure- rather than use their insurers. 

Any idea who I can go to to try and work one out? 

I’m still working full time. 

(I know MPAA has gone up to £10k pa) 

I have a Pensionwise appointment but would be grateful for suggestions. (Eg what type of accountant, actuary?)
Thanks. 

RogerPensionGuy

Helenadviceplease said:

Hi, 
So my IFA finally admitted they were wrong. They want to meet to work out a settlement figure- rather than use their insurers. 

Any idea who I can go to to try and work one out? 

I’m still working full time. 

(I know MPAA has gone up to £10k pa) 

I have a Pensionwise appointment but would be grateful for suggestions. (Eg what type of accountant, actuary?)
Thanks. 

This is a very happy result. 

I would be in no rush to settle whatsoever.

You really really need expert advice I suggest, I'm guessing any fees you maybe charged will be paid by the people that gave you bad advice.

In my head I was thinking you wanted to plonk 30 or 40K into your SIPP and unfortunately have been very very affected, guessing you would be also contributing at these  figures until you were 75 at least. 

It sounds like the organisation may like to pay you a hansom settlement without causing them any insurance problems in the future, they probably also don't want much press coverage and looks like the tables have turned 180 degrees. 

I'm hoping the settlement you get will be cash and you will not pay any taxes accepting this from them, so indeed you could be going from very financially hurt to attaining a large chunk of cash tax-free I hope.

This thread has cheered me up at lot.

Cheers Roger. 

Marcon

Helenadviceplease said:

Hi, 
So my IFA finally admitted they were wrong. They want to meet to work out a settlement figure- rather than use their insurers. 

Any idea who I can go to to try and work one out? 

I’m still working full time. 

(I know MPAA has gone up to £10k pa) 

I have a Pensionwise appointment but would be grateful for suggestions. (Eg what type of accountant, actuary?)
Thanks. 

I bet they do!

Rather than agreeing to a meeting, ask them to put their proposals in writing and say you will be taking advice once you have seen these.

Helenadviceplease

Thank you so much James & Marcon. 

Can either of you advise what type of financial experts I should speak to please? 

Kr
Helen 

Marcon

Helenadviceplease said:

Thank you so much James & Marcon. 

Can either of you advise what type of financial experts I should speak to please? 

Kr
Helen 

Rather depends what they come back with and how clearly they set out their 'workings' (in terms of how they get to the figure they are offering you). A highly competent IFA with good actuarial contacts would be my first choice.

Roger175

OP, be careful how you play this. I am a professional consultant in an entirely different field, but I have experienced various claims for negligence. Both against our firm (one unfortunate case involving a rouge member of staff) and against other firms. When a firm makes an offer to settle without the involvement of their Professional Indemnity Insurers, they are entering very difficult territory and taking a big risk. You need to be aware that a firm will only offer this if they think it will lead to a quick and cost effective settlement, but if you start playing hardball, then they will probably just withdraw the offer and refer it to their insurers. At this point the insurers will probably appoint a loss adjuster and you will be in for a very long and difficult fight. The only reason you have received this approach is that the IFA is weighing up the cost involved in increased Insurance premiums etc, if you start trying to get a full blown settlement on this basis, he loses any incentive to avoid placing the matter with his insurers. In other words either take a sensibly offer for a quick settlement or be prepared for a long and unpleasant process. 

I'm not actually sure how PII (Professional Indemnity Insurance) works in the IFA industry, but I would consider offering to settle directly with a client to be an extremely risky thing to do. Most PII policies that I've come across make it a condition that Insurers must be notified as soon as there is even the suggestion of a claim and typically the Insured company is required not to enter into any correspondence with the claimant. Doing so risks the Insurers refusing to pay out against the claim. I would be interested to know if this is the same in the finance industry.

Roger175

Following my last post, it occurs to me to add that I think it is highly unlikely that your IFA will write to you setting out what he offering if he is hoping to make a 'cash' offer. Hence the reason he has asked you to meet him. For the reason I alluded to in the last paragraph above, he will not want to formally admit too much for fear of jeopardising any insurance claim. 

You have little to lose by meeting with him, but do bear in mind that if he puts it in the hands of his insurers, the loss adjuster will rake up all the previously discussed arguments and there is no guaranty they will settle. 

Marcon

Roger175 said:

Following my last post, it occurs to me to add that I think it is highly unlikely that your IFA will write to you setting out what he offering if he is hoping to make a 'cash' offer. Hence the reason he has asked you to meet him. For the reason I alluded to in the last paragraph above, he will not want to formally admit too much for fear of jeopardising any insurance claim. 

You have little to lose by meeting with him, but do bear in mind that if he puts it in the hands of his insurers, the loss adjuster will rake up all the previously discussed arguments and there is no guaranty they will settle. 

I too think it's unlikely - but at some point the details will need to be set out so OP's own adviser can review.

The big difference between financial services and most other industries is the existence of some rather useful Ombudsmen - and as the IFA has already admitted they made a mistake (doesn't need to be in writing - the suggestion of a meeting to sort out a settlement gives the game away), OP always has the option of asking the Financial Ombudsman to sort out a reasonable settlement figure, which the firm will be well aware of.