St James's Place  

SJP claims FCA deemed pension transfers suitable

SJP claims FCA deemed pension transfers suitable

The Financial Conduct Authority (FCA) reviewed a small number of defined benefit (DB) pension transfers advised by St James’s Place (SJP) and found them all suitable, according to the firm's chief executive.

In a letter to Labour MP Frank Field, chairman of the Work & Pensions select committee, Andrew Croft revealed the regulator included 65 of SJP cases in its suitability review published last year.

Mr Croft argued the watchdog found the firm's suitability results were superior to the rest of the industry results of 93 per cent suitable cases.

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The probe into SJP pension transfer cases was made in the context of this review.

Mr Croft was responding to a letter sent by Mr Field, after SJP was accused of approaching scheme members during the consultation process for closing British Airways New Airways Pension Scheme (NAPS) to future accrual last year.

SJP was accused of being very active in trying to promote cash equivalent transfer values.

At the time, the firm denied claims of 'factory gating' British Airways pension scheme members, arguing it has "strict policies in place around marketing and the transfer of pensions".

In his letter, Mr Croft said the firm has worked with clients that are British Airways pilots in "relation to their overall financial circumstances for a number of years," with one particular SJP adviser having developed a "very close working relationship with this community".

SJP began offering seminars to pilots after significant changes in the scheme in 2007 and the introduction of a new redundancy scheme in 2009, at existing clients request, Mr Croft explained.

He said: "For clarity, the sessions are in no way promoting or designed to promote pension transfers.

"These have now been running for the past nine years and it is therefore also important to note that they weren't established in response to the closing of NAPS announced at the end of last year."

Mr Croft added since 2009 there have been 44 briefings, attended by 353 British Airways flight crew and senior managers.

Of these, 16 per cent (58 people) have subsequently arranged a transfer through SJP, with 7 per cent transferring within a year of attending the seminar, he said.

Since the announcement of the closure of the scheme to future accrual, there have been three seminars with 28 attendees, with only two individuals currently taking advice with a view of arranging a transfer, he noted.