The Financial Conduct Authority has stepped up the restrictions imposed on Bank House Investment Management – a financial advice firm – meaning Bank House can no longer carry out any regulated activity.
Previously, the regulator said that Bank House could no longer “Carry out regulated activities in relation to pension switches and/or pension transfers to any self-invested personal pension scheme […] expert where the member’s funds are to be invested wholly in standard investments”.
Standard Investments are those regulated by the FCA, as opposed to unregulated and non-standard investments like Carbon Credits, Overseas Property, Storepods and forestry schemes etc), which are HIGH RISK.
But as of December 2016, the FCA has stepped up their restrictions on Bank House, meaning that the firm can no longer carry out ANY regulated activities, including transferring pensions of any kind – it is simply not allowed anymore!
Why impose further restrictions on Bank House Investment Management?
In the FCA publication, the regulator went on to explain why they were making the decision to stop Bank House Investment Management from taking on any new business:
“The Authority conducted a short notice visit to the Firm on 15 and 16 July 2015. During the visit the Authority obtained information about pension switching business that the Firm had conducted which had resulted in customers switching their pensions to self-invested personal pensions (SIPPs) with the underlying investments in high risk, unregulated investments.”
“As a result of this information, the Authority had serious concerns about the suitability of the Firm’s pension advice. To deal with its immediate concerns about the risks that this posed to customers, on 17 July 2016 the Authority invited the Firm to apply for a requirement to be imposed on it under section 55L of the Act requiring that it, among other things, not carry on any activities in relation to pension switches and/or pension transfers to SIPPs.”
What this means is, that the FCA has concerns over the way Bank House Investment Management was conducting the transfers of people’s pensions into SIPPs, due to the selection of high-risk investments.
High-risk and unregulated investments are not always suitable for people who aren’t High-net worth individuals or sophisticated investors, and the FCA’s concerns seem to centre around suitability.
Breach of voluntary Requirement – breaking the rules
Despite the terms of the agreement with the FCA in which no funds were to be transferred into SIPPs, it appears that over 50 transfers still went ahead into SIPPs, confirmed by a SIPP provider.
Bank House and Third Party Relationships
As we have seen through our work at Get Claims Advice, many of the clients that had their pensions transferred into SIPPs by Bank House were introduced to the business by a third-party firm. Often referred to as an “unregulated introducer”, these firms often act as salesman, referring the business to IFAs like Bank House, SIPP providers and unregulated investments
Unregulated introducers are believed to be a huge part of the growing pension mis-selling scandal, making cold-calls to prospective clients who do not have the knowledge or cash to run the risk of a SIPP with unregulated investments.
In the case of Bank House, large sums of money were transferred between one particular Third Party Firm and Bank House.
The FCA and Consumer Protection
The FCA justified their restrictions; “The Authority’s objective of consumer protection requires the Authority to ensure an appropriate degree of protection for consumers. In light of the facts and matters explained above, the requirements at paragraph 1 above are also justified in furtherance of this objective.”
What it means: The FCA is there to protect consumers, and cannot ignore the failings and conduct of Bank House Investment Management.
Have you transferred your SIPP pension with Bank House Investment Management?
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