The Pension Protection Fund is concerned some financial advisers are using the British Steel Pension Scheme deficit as a way to lead pension holders towards doing a transfer – something some financial advisers make a big profit on!
The PPF, which was set up as a “lifeboat fund” for Defined Benefit company pensions (just like the British Steel Pension Scheme), spoke through Sara Protheroe – the organisation’s chief Customer Officer, revealing that:
• The organisation was working with the FCA over “poor practice” over advise to transfer away from such schemes
• They feel some advisers are using the pension scheme deficits to generate “fear” in their clients in order to get them to transfer out of the scheme.
Transfer Decisions driven by ‘Greed and Fear’
The PPF didn’t mince their words when they said that they receive reports of transfer clients making the often risky decision to transfer their pension based on “greed and fear”.
Speaking specifically about transfers away from the British Steel Pension Scheme, Protheroe said that “There is evidence of poor advice”, adding that there were reports of a “feeding frenzy” of financial advisers around BSPS looking for lucrative transfers like “vultures”.
Was your BSPS transfer suitable?
Financial advisers have strict rules they are supposed to follow in order to ensure they are advising in YOUR best interests, and not simply lining their pockets. Considering that MPs are now asking financial advisers connected to BSPS transfers to provide evidence for an inquiry, it could be a good idea to have your pension advice checked to make sure your transfer hasn’t put you at risk. You could even be due some compensation!