IFA concern over firm offering pension transfer ‘incentive’

Advisers have raised concerns about a company that appears to have been cold-calling consumers and offering a £3,000 incentive for savers that are prepared to transfer their pension to one of a number of particular providers.

FTAdviser was alerted to Forensic Review by Paresh Shah, director of IFA firm Financial Solutions 2000, who says he was cold called by the firm and offered the ‘incentive’. Forensic Review carries out pension reviews and switching.

During the telephone call, a recording of which has been heard by FTAdviser, a female identifies herself as representing Forensic Review and says that she is offering a free valuation of Mr Shah’s existing pension.

The caller goes on to say that if Mr Shah returns a letter of authority to the firm, it will “look at the options available”. One option is to transfer the pension to a new provider, she continues, adding that if Mr Shah decides on one of certain providers it will pay £3,000 “as an incentive to move your pension over.”

When Mr Shah asked where this £3,000 came from, the caller said that the money does not come out of the pension and that the investment company where the pension will be invested pays.

She says: “Not going through a broker, no middle man, so essentially you are earning your own fee.”

Adam Bennett, managing director of the Aims brand, denied that Forensic Review offers incentives to consumers and said that it does not “cold call” people about their investments.

He said: “We do not offer any incentive to our clients who switch pensions. We are a money saving membership service, which assesses members circumstances with a view to reducing their outgoings, repatriating them with money in respect of mis-sold financial products, or re-broking/switching underperforming products.

“The specific action of pension reviewing/switching is carried out by our group company Forensic Review, which does not offer either advice or incentive to clients.”

FTAdviser also called Forensic Review posing as a consumer and asked if there was an incentive to transfer a pension pot. The agent answered in the affirmative, saying that a £3,000 “fixed fee” would be paid and that a free membership with another company would also be provided.

When asked where the pension would be invested, the agent told FTAdviser that the pension would be invested in biofuels and woodland “as they are more stable than the stock market”.

The agent said that Forensic Review is not regulated by the Financial Services Authority, as they only value an individual’s pension and then give options, but do not give advice.

He said: “If you don’t want the options, you don’t take them. We are an introducer, we do not give advice.”

The seller told FTAdviser that this plan was only available to those with a pension pot greater than £20,000, but he added that the firm is looking for “possible products” for pension pots that are under £20,000 and that these will be “launched later this month”.