The Financial Conduct Authority has banned Mark Abley of County Capital Wealth Management Ltd from providing any advice on pension transfers.
The regulator has also told Abley to pay £106,100 to the Financial Services Compensation Scheme rather than the FCA, to contribute towards the redress owed to CCWM’s customers.
If he fails to pay this amount or any part of it, the FCA will enforce this amount as a fine.
CCWM, which was based in County Durham and also trading as The Pension Review Service, failed on July 21, 2022 and is currently in liquidation.
Between April 2015 and February 2018, CCWM advised 575 out of 595 people to transfer out of their defined benefit pension schemes – including almost 150 members of the British Steel Pension Scheme.
This is despite the FCA's guidance creating a presumption against advising a client to transfer.
Abley was responsible for this advice, over half of which (56 per cent) failed to meet the required standards and showed, the FCA said, a lack of competence.
The City watchdog said he received a financial benefit of at least £60,000 for providing this advice.
The FCA alleged that Abley did not obtain the information needed to make a suitable recommendation or properly assess whether the customer could understand and bear the financial risks of transferring their guaranteed pension.
He also failed to provide evidence to show the transfers were in his customers’ best interest, the regulator said.
There were also errors in the calculations used to compare customers’ existing pension schemes with the schemes it was proposed they transfer into.
Therese Chambers, joint executive director of enforcement and market oversight at the FCA, said: “Mr Abley’s incompetence meant that he failed to give customers the advice they needed to make a significant decision about their retirement.
“This included hundreds of people who were dealing with the uncertainty around the British Steel Pension Scheme.
“He earned fees while putting their retirement money at risk. It is only right that he contributes to the costs of compensating these customers.”
Since March 14, 2023 the FSCS has upheld 53 pension transfer claims against CCWM and paid out over £2.1mn in compensation to customers of CCWM.
The BSPS case
During 2017, BSPS members were asked to make decisions about their pensions as part of a restructure of the scheme.
About 8,000 members transferred out of the scheme, with transfers collectively worth about £2.8bn.
But concerns about the suitability of the transfers were soon raised, leading to an intervention from the Financial Conduct Authority that resulted in a number of advice firms – key players in the debacle – stopping their transfer advice service, while others went out of business.
Some of these firms regained their permissions, such as Mansion Park and County Capital Wealth Management, also trading as Pension Review Service.
The debacle created a mountain of liabilities, which lawyers believe could end up costing the industry up to £300mn.
The FCA announced last year that it plans to deliver £71.2mn in compensation to former members of the scheme who received unsuitable advice.
The scheme covers those who transferred out between May 26, 2016 and March 29, 2018.
However, in February this year a number of steelworkers wrote to the FCA expressing concerns about the regulator’s calculations for the scheme.
sonia.rach@ft.com
What's your view?
Have your say in the comments section below or email us: ftadviser.newsdesk@ft.com
