The Financial Conduct Authority has relaunched its pension transfer ‘advice checker’ tool, designed so consumers can see whether they received unsuitable advice.
The tool, which first launched in 2020 and was updated yesterday (April 21), has 11 stages asking consumers about the advice they received.
During the initial launch, the FCA said its assessment of pension transfers between 2015 and 2019 found that some advisers may have given unsuitable advice to transfer out of a DB pension scheme into a defined contribution (DC) pension scheme.
It urged consumers to use the advice checker tool if they were advised to transfer out of a scheme, or if they transferred because the firm encouraged them to do so.
The FCA said some of the changes made for the relaunch were to make the language clearer and make the user journey better.
The relaunch comes as last month the FCA launched a consultation on a redress scheme for former members of the British Steel Pension Scheme.
The regulator set out plans to deliver £71.2mn in compensation to former members of the BSPS who received unsuitable advice to transfer out of their pension.
At the time, the FCA wrote to firms who had advised on BSPS making clear that firms should not dispose of any assets and maintain adequate financial resources.
This is to ensure that firms can meet the costs of carrying out a review and compensating customers for any unsuitable advice they may have given if the scheme is implemented.
The regulator has already taken action against a number of firms, including stopping a BSPS firm earlier this week from disposing of its assets.
Last year, the City watchdog also released an assessment tool to help advisers understand whether the defined benefit pension transfer advice they have given was suitable.
The Defined Benefit Advice Assessment Tool (DBAAT) assesses advice given before October 2020.
The regulator's data has shown DB advice firm numbers have shrunk from 3,000 in 2018 to 1,200 now.
From June 5, 2020 to July 31, 2021, the number of firms that gave up their defined benefit transfer permissions since the regulator's ban on contingent charging came into force was 687.
A similar number, 700 advice firms, relinquished their permissions in the lead up to June 5, in the wake of the FCA's crackdown on unsuitable advice.
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