These themes and a couple more will now be condensed into our regular end-of-week round-up.
1) Pension problems and solutions
The week began with the Chartered Insurance Institute issuing an “unprecedented” call to life, pension and long-term savings providers to commit to a new framework of professional standards.
After last April’s landmark at-retirement reforms, the CII and various industry stakeholders undertook a year of analysis, looking at the challenges facing the sector and identified the first point of contact for savers as being a crucial area to aim at improving, in order to ensure consistency of consumer experience across the industry.
Nine big name companies have already signed up to the two-year commitment to raise their game, with the CII’s director of financial services and insurance markets Steve Jenkins telling FTAdviser the rest of the industry is getting on board soon.
More post-freedoms data dribbled out this week as well, with predictions of the death of annuities turning out to be wide of the mark, according to eValue statistics.
Meanwhile, Intelligent Pensions suggested defined benefit pension transfer requests have surged by more than 14 times over the last year, as members take advantage of the increased flexibility.
Yesterday (9 June), Hargreaves Lansdown announced it would not to revive its DB pensions transfer operations, after temporarily closing the service last August in response to an inundation of transfer requests.
“When a client asks us whether they should transfer out of a DB scheme, the trouble is most of the time the answer is ‘no you shouldn’t,’” pointed out head of communications Danny Cox.
Finally, on DB issues, Standard Life Wealth’s head of business development Ronnie Binnie argued that the regulation covering such legacy schemes must keep pace with that covering the rapidly-expanding defined contribution side of the market.
2) Asset managers hit by volatility
Standard Life was also in the news as the hardest hit - £1.4bn left its European Equity Income fund - of a group of its peers that took the brunt of an asset management sales downturn across last year.
BlackRock, Deutsche Asset Management, JPMorgan, Fidelity, Schroders and Invesco - six of Europe’s top 10 largest fund providers - all suffered at the hands of chaotic market conditions, according to Morningstar figures.
The wider industry appears to be in flux, with M&G again changing the pricing on its £4.7bn Property Portfolio, reflecting flows in and out of the fund.
Meanwhile, Aviva Investors is to close its £60m Global Cautious Income and £39m Global Balanced Income over fears their income targets could lead to “an inappropriate level of risk” being taken in future.
3) Advisers in the dock
On Monday (6 June), four men were found guilty of a tax avoidance scheme that conned HM Revenue & Customs out of £100m.
They falsely inflated the expenses of their film productions so investors could collectively claim tax repayments, but an investigation discovered more than £250m was spent on pre-production and development packages for film projects created in Monaco, when the packages had actually only cost £4m and were created in London.
Separately, the Financial Conduct Authority banned two men who arranged for nearly £24m to be put in unsuitable investments.
Mark Kelly and Patrick Gray worked at PCD Wealth and Pensions Management, where between 2008 and 2010 they arranged for more than 350 customers to invest in these products, but failed to declare the fees they were receiving.
The obligatory Financial Ombudsman Service case this week saw Gemini Wealth Management being told to compensate a client who was told to invest in a Capital Investment Bond.
The complainant said the charges were unfair, unclear and not proportional to her investment, Gemini responded they were explained in line with regulatory requirement at the time, but the ombudsman said its assessment of the clients risk profile was confusing.
4) Authorisation delays
This week’s Financial Adviser front page featured the revelation that the FCA’s average processing times for authorising retail firms has been rising, and as of the end of March, sat at nearly 25 weeks.
It promised to eliminate this backlog by the end of the year, admitting advisers are being left “in a state of limbo” by a maximum processing time in the first quarter of 2016 was 50 weeks.
This morning (10 June) the regulator’s own data bulletin showed complaints made against the it shot up in February to 154, from 48 received the previous month and 30 in December - although this was mainly blamed on its role in Lloyds decision to call in enhanced capital notes.
5) Network hard at work
Finally, a quick word on Tenet, which was the subject of a few popular stories this week.
On Monday, its wholly-owned appointed representative Aspire Financial Management bought the client bank of Furness Building Society’s financial advice arm.
Then only a few hours ago, the network proper announced it will pilot a programme of buying up the businesses of its retiring advisers.
Tenet’s chief executive also hit back at the regulator’s refusal to consider introducing a product-based premium as a means of funding the Financial Services Compensation Scheme.
“Their apparent dismissal of the proposal, on the grounds that it would require the drafting of new legislation, doesn’t make any sense,” argued Martin Greenwood.
