IFA advocate Evan Owen has set up a legal action group for advisers who may be considering challenging national advice firm Ashley Law.
The development follows news that Ashley Law had contacted advisers to recover costs and compensation from them following a four-year “skilled person” review into pension transfers.
Mr Owen, who has one member in the group so far, said that advisers disputing these requests would first deal with Ashley Law through the Advisory, Conciliation and Arbitration Service, but they could take legal action if they fail to reach a mutual agreement.
He said: “They can engage Acas if wages are unlawfully withheld and if they have legal expenses insurance they can take the network to court (if no resolution is reached).
“The Ashley Law case is no different to any other network where there is no causal link between the actions of the adviser and the collapse of Keydata or problems caused by inadequate systems and controls in matters such as pension transfers.”
Jock Cassidy, managing director of Ashley Law, said: “Anyone dealt from the bottom of the pack should be able to challenge why one of his/her cases has been found wanting. Conversely, if an adviser is unable to produce the documentation required by the company to support his/her recommendations, he/she ought to be prepared to accept blame.
“Ashley Law always invites advisers to discuss their issues but it must be realised that if the likes of the ombudsman upholds a complaint, there is no appeals process similar to the process enshrined in English Law.”
Last week FTAdviser revealed the national firm is set to recover at least £1m from its advisers for its pension transfer review, which was ordered by the regulator.
The firm is recovering the negotiated flat rate cost of £800 plus Vat for each case charged by the third party investigator and will also seek any compensation due, which under the terms of its agreement with the FCA, it will initially pay out.
Out of 1,000 pension transfer cases reviewed over four years, 250 are believed to have been found to be unsuitable and requiring redress to be paid. One adviser said his bill for 10 cases to be reviewed, of which four will be compensated, is approximately £20,000.
Yesterday, FTAdviser revealed that network Sesame has pledged not to pursue advisers to recoveries related to its own regulator-ordered pension transfer review, which contributed to £19m of losses recorded by the firm in 2013.
