National IFA firm LEBC has agreed to give up its defined benefit pension transfer permissions.
Kay Ingram, director of policy at LEBC, confirmed to FTAdviser that the firm voluntarily relinquished its pension transfer permissions to the Financial Conduct Authority this morning (September 2). She declined to give further details on the matter.
In a market update earlier today owner B.P. Marsh & Partners – which holds a 59.3 per cent stake in the firm – stated that as part of its market-wide review of the DB transfer market, the FCA has undertaken a review of LEBC’s pension transfer advice.
“Following this, LEBC has agreed voluntarily to cease the provision of DB pension transfer advice and projects, forthwith,” it added.
B.P. Marsh & Partners stated its officials were working closely with LEBC's management to return the firm to “the position it was in before the FCA review”.
The FCA had surveyed 3,015 firms between April 2015 and September 2018. In June it concluded that too much of the advice on DB transfers it had seen was "still not of an acceptable standard".
It also voiced concern about the volumes of recommendations, with 69 per cent of clients having been recommended to transfer.
The watchdog found the average transfer advice value was £352,303, equivalent to a total value advised on of £82.8bn. This included both actual transfers and advice against it.
The FCA is concerned that firms are recommending that large numbers of consumers transfer out of their DB pension schemes, despite its stance that transfers are likely to be unsuitable for most clients.
Darren Cooke, chartered financial planner at Red Circle Financial Planning, wasn’t surprised by the news.
He said: “National firms are the ones that advisers have targets to comply with.
"Any firm that has done a significant number of DB transfers should expect a visit from the FCA.”
In October, FTAdviser revealed that 18 firms had voluntarily given up their DB pension transfer permissions following a tighter stance from the regulator in this field.
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