The Financial Conduct Authority (FCA) is probing a “small number of firms” for failing to follow current guidance by not including all fees and charges in their pension advice redress calculations.
The watchdog says it has received complaints suggesting that the firms are not considering ongoing fund costs and not fully allowing for continuing adviser charges in redress calculations. This is contrary to its current guidance, FG17/9 Guidance for firms on how to calculate redress for unsuitable defined benefit pension transfers.
“We are looking into these matters and where we identify firms not calculating redress correctly, we will take action using the full range of our powers, which may include appointing an independent professional to check calculations and help consumers get the right redress,” the regulator said in a statement. “While we have only seen a small number of firms calculating redress incorrectly, we remind all firms undertaking calculations of the importance of allowing for fees and charges correctly.”
The watchdog acknowledged that while “this is a complex area, firms need to take special care, given the potential for consumers not to receive the compensation they deserve”. It added that this is particularly important for any firm that is making calculations for former British Steel Pension Scheme members, ahead of the FCA board’s decision on whether to implement a consumer redress scheme.
Meanwhile, the FCA is looking for panel members to join its new Innovation Advisory Group, to share the financial and regulatory technology sectors’ views on innovation in financial services and act as a critical friend to the regulator’s innovation department. It has invited a number of key stakeholders to take part, but is also seeking expressions of interest from organisations or individuals who wish to join on a rotating basis for an initial one-year period.
Candidates are asked to email a CV and brief cover letter to [email protected] no later than 1 December, and to read the Innovation Advisory Group Terms of Reference before applying.