Claim for historical pension advice

slb2020

Almost 25 years ago, I was advised by a regulated company to transfer from a defined benefit pension scheme I has with a previous employer to a personal pension. I recently rediscovered the paperwork for this and with hindsight, the terms of the transfer look pretty poor. The pension represented nearly 10 years worth of contributions so it was a significant amount.

I gather it is possible to claim for mis-selling even after so long. To do so, it seems I either claim from the company that provided the advice or, if they are insolvent from the FCA. My problem is that the company who advised me went through a series of acquisitions and disposals. Their assets seem to have been distributed between several different companies. I have contacted some of these companies and their response is that they are very sorry but they are not responsible for this matter.

I know their are companies who pursue claims for mis-selling, in return for a substantial chunk of the proceeds. Should I go with one of them? Can any one suggest an effective way of pursuing this independently? Or is it all just to long ago and not worth the hassle of claiming?

Dazed_and_C0nfused

I recently rediscovered the paperwork for this and with hindsight, the terms of the transfer look pretty poor. 

Same goes for my bet on this year's Grand National, wonder if Ladbrokes will give me my money back 🤔

MallyGirl

I have definitely seen comments on here which indicate that these type of transactions should already have been reviewed - I guess it is harder when 'you' have been passed from company to company. Hopefully someone with the right knowledge will be along soon. 
I am sure that you can avoid one of those no-win no-fee shysters with a little guidance - if it is possible to claim that is.

westv

I was also given advice not to transfer a DB to DC transfer exactly 25 years ago this June. 

In the years since the DB pension went belly up/rescued by the FAS so I will get 90% when in payment and nil inflation rises (would have been up to 5% I think).

The paperwork has long gone but I don't doubt the advice given at the time was correct based on the information known then. However, I do sometimes wonder what my position would have been now if I had transfereed. No way of knowing now of course.

dunstonh

with hindsight, the terms of the transfer look pretty poor.

Hindsight is not grounds for complaint.

I gather it is possible to claim for mis-selling even after so long. To do so, it seems I either claim from the company that provided the advice or, if they are insolvent from the FCA. 

Not the FCA.  The FSCS.

I have contacted some of these companies and their response is that they are very sorry but they are not responsible for this matter.

The liability normally stays with the advising company.   Unless it is a 100% buy out (which it usually isnt) then the new companies do not take on the liability.

I know their are companies who pursue claims for mis-selling, in return for a substantial chunk of the proceeds. Should I go with one of them?

Statistically, they have a lower success rate than personalised complaints.  Even the FOS tell people not to use one.

 Or is it all just to long ago and not worth the hassle of claiming?

You haven't told us anything about your reasons for complaint and what wrongdoing you are referring to.  So, we cannot really give you an opinion.

Mallygirl above mentions the pension review that took place.  However, that was only for 1988-1995.   A missold DB transfer in 1997ish sounds unlikely.  Yes, it is possible but by 1997, financial firms were aware of the issues that the regulator had in mind and it was still a hot potato from a regulatory point of view.     It took another 15 years for some people to lose their memories and start misselling them again.   So, I would expect a 1997 sale to have a pretty good audit trail.  Not to 2022 levels but good for the time (whereas say a 1993 case would have a high chance of being substandard).

sandsy

The terms for transfer vary over time as they depend on economic circumstances at the time. Transfer values are much higher now than I'm the late 1990s. I doubt that would hold up on its own as a reason for allowing a claim.

Thrugelmir

slb2020 said:

I recently rediscovered the paperwork for this and with hindsight, the terms of the transfer look pretty poor. 

Based on what? 

Marcon

slb2020 said:

Almost 25 years ago, I was advised by a regulated company to transfer from a defined benefit pension scheme I has with a previous employer to a personal pension. I recently rediscovered the paperwork for this and with hindsight, the terms of the transfer look pretty poor. The pension represented nearly 10 years worth of contributions so it was a significant amount.

Doesn't mean it was automatically poor advice - much depends on what you told your adviser at the time in terms of what was important to you. 

slb2020

Thanks for the responses. It was actually in 1996 that I received this advice. The reason for my concern is that the transfer value out of the pension was less than the projected income from the pension in the first year of retirement.

The advisors claimed that compound growth  would make up for this. Specially, the advice states that, to match the pension I was transferring out of, investment growth would need to be:

* 9.92% per annum for retirement at at 65

* 10.15% per annum for retirement at at 60

Of course to benefit from the transfer, I would need higher growth than that. So in 1996, was it a reasonable expectation that long term investment growth would remain so high?

There is also a comment in the advice that "if annuity rates fall, then the level of pension benefit would also fall". This is buried in the small print and there is no explicit statement that falling annuity rates is a risk for personal pensions but not for defined benefit pensions.

slb2020

Marcon said:

slb2020 said:

Almost 25 years ago, I was advised by a regulated company to transfer from a defined benefit pension scheme I has with a previous employer to a personal pension. I recently rediscovered the paperwork for this and with hindsight, the terms of the transfer look pretty poor. The pension represented nearly 10 years worth of contributions so it was a significant amount.

Doesn't mean it was automatically poor advice - much depends on what you told your adviser at the time in terms of what was important to you. 

As I recall I said I have a medium attitude to risk, don't know the age at which I will retire but am looking to maximise my income in retirement. Don't think that's recorded in any of the documents though

Albermarle

The reason for my concern is that the transfer value out of the pension was less than the projected income from the pension in the first year of retirement.

If I take your statement literally , it says that if the projected annual  starting  pension from the DB pension was £X K pa , then the CETV ( transfer value) was less than £XK? 

Surely that can not be right . A typical transfer value today would be £XK  multiplied by 30 . Even if it would have been less in 1996 .

I assume I have misunderstood , can you clarify exactly what you mean ?