Can an IFA withdraw their service to me

simprove

I am retired and have my workplace pension invested with a well established national pension fund. My IFA is retiring soon and has merged his business with a larger firm to provide continuity to his clients. It now turns out this firm has its own pension wrapper product, which it is keen for its new clients to transfer to. I got an offer to transfer my funds at no charge. The returns would be better, there would be more flexibility for me to take control of my investment, but the charges are correspondingly higher.

When my new advisor turned up to present the offer in detail, it transpired that the new IFA was unwilling to continue operating my existing pension arrangement and that service would be withdrawn at some point, leaving me without an IFA. I would either have to deal directly with the pension fund or find a new IFA, willing to take me on the terms I currently have.

Can an IFA, regulated by the FCA, act in this way, dropping a client with little or no warning if they don't take their less than independent advice?

Ibrahim5

It's all about the IFA and their business. You are just an insignificant pawn in their plan. They are retiring and selling their business for a fortune and throwing you under the bus.

HappyHarry

You will have to excuse the above poster; they like to hunt down threads on IFAs so they can add some insults. Nobody is really sure why.

In a nutshell yes, the new business can refuse you as a client. The same way as (almost) any business can. If you don’t fit the profile of their clients then neither you nor the business is going to benefit greatly from an ongoing relationship.

There are plenty of other IFAs out there to speak to.

dunstonh

 The returns would be better, there would be more flexibility for me to take control of my investment, but the charges are correspondingly higher.

Is that on a like for like basis. For example, if you have 50% equities at the moment, then anything with more than 50% equities would likely have performed better.

When my new advisor turned up to present the offer in detail, it transpired that the new IFA was unwilling to continue operating my existing pension arrangement and that service would be withdrawn at some point, leaving me without an IFA. 

Are you sure the new one is an IFA? your reference to own product and not being able to service the existing contract suggests that they do not hold IFA status but are FAs.

Its also confusing as IFAs are not normally attached to workplace pension schemes. You refer to  a well-established national pension fund but that doesn't sound like the type of thing an IFA does. Certainly, on old-fashioned group schemes, an IFA can be attached but those are typically small local/regional employers with their own scheme via an insurance company. With auto-enrolment compliant schemes, an IFA is typically only involved if the employer pays them to be and very few do that beyond the initial setting up.

There are some auto-enrolment compliant schemes where FAs can be attached them.

Plus, if it is an established national pension fund, then why would a single IFA be involved? The nationals are typically looked after by a team of people (typically administrators rather than IFAs).

Can you expand on the current set up so we get an understanding of your current service as I wonder if there is some misunderstanding over what you have and what services you are paying for.

Can an IFA, regulated by the FCA, act in this way, dropping a client with little or no warning if they don't take their less than independent advice?

Yes. Any business can refuse to offer its services to you in all walks of life. As long as it is not for discriminatory reasons.

hotncold47

Sounds like something True Potential used to do, then pay 8% to the retiring IFA

jimjames

When my new advisor turned up to present the offer in detail, it transpired that the new IFA was unwilling to continue operating my existing pension arrangement and that service would be withdrawn at some point, leaving me without an IFA. I would either have to deal directly with the pension fund or find a new IFA, willing to take me on the terms I currently have.

Do you need an IFA? If everything is setup for you, can't you just leave the pension/investments where they are to grow until retirement? If you feel you need another IFA at a later date then you can always find one at that point but in the meantime you'll have saved those significantly increased fees from the new provider.

simprove

https://forums.moneysavingexpert.com/discussion/comment/81927127#Comment_81927127

Yes, I do need an IFA with the current pension fund. Customers have very little access to change anything, whereas my IFA was able to make changes for me.

Albermarle

https://forums.moneysavingexpert.com/discussion/comment/81927321#Comment_81927321

You should be able to transfer out to a pension provider who is happy to deal with customers directly ( there are many )

dunstonh

https://forums.moneysavingexpert.com/discussion/comment/81927321#Comment_81927321

please can you name this established national pension fund.

Marcon

I suspect this might be a provider who operates only through intermediaries rather than a 'national pension fund'.

simprove

I would rather not name it as it may identify me to someone from this new IFA who is aware of my concerns. They are a big concern and regularly advertise on TV.

I was trying to answer your earlier post using quotes but the quote button includes everything in and I can't edit it to only quote your words. Is there a help guide for using the forum?

To answer your earlier post as best I can using quotes and italics:

"Is that on a like for like basis. For example, if you have 50% equities at the moment, then anything with more than 50% equities would likely have performed better."

Yes, more or less.

"Are you sure the new one is an IFA? your reference to own product and not being able to service the existing contract suggests that they do not hold IFA status but are FAs.

Its also confusing as IFAs are not normally attached to workplace pension schemes. You refer to  a well-established national pension fund but that doesn't sound like the type of thing an IFA does. Certainly, on old-fashioned group schemes, an IFA can be attached but those are typically small local/regional employers with their own scheme via an insurance company. With auto-enrolment compliant schemes, an IFA is typically only involved if the employer pays them to be and very few do that beyond the initial setting up.

There are some auto-enrolment compliant schemes where FAs can be attached them.

Plus, if it is an established national pension fund, then why would a single IFA be involved? The nationals are typically looked after by a team of people (typically administrators rather than IFAs).

Can you expand on the current set up so we get an understanding of your current service as I wonder if there is some misunderstanding over what you have and what services you are paying for."

Now I'm beginning to wonder if they are an IFA. I assumed they were because my old advisor had acted as an IFA and I didn't think he would change the nature of the business when merging with a new company.

To summaraise, I used to belong to a group private pension scheme with previous employer, and my old IFA was the pension advisor to that company. I became self employed and he advised me on setting up my existing pension for self employment. He advised me to switch to a different provider. Their fund has performed well for me. He also made other changes to suit my needs. Things the customer website does not make available.

"Yes. Any business can refuse to offer its services to you in all walks of life. As long as it is not for discriminatory reasons."

Of course, but in this case it seemed I had been accepted as a client. I didn't realise the next stage was offering me a new investment offer for my pension fund. I had no reason to suspect this as I had received no terms and conditions. So this feels like being rejected, having taken my business on.