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FSCS declares BSPS advice firm in default

FSCS declares BSPS advice firm in default

The Financial Services Compensation Scheme (FSCS) has declared another advice firm involved in the British Steel pensions saga in default. 

West-Yorkshire based firm Keywood Olley & Associates Ltd, trading as North East Mortgages and EMH Financial Planning, was declared in default on April 5.

According to the Financial Conduct Authority's register, a previous name for the firm was Eden Pensions & Retirement Solutions. 

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The FCA register also stated the firm was ordered to cease all regulated activities on August 9, 2021 and previously had an asset retention order.

The FSCS told FTAdviser it had received two claims against the firm so far, both of which are for pensions advice.

One of the claims is for a transfer out of the BSPS, it said. 

The FSCS has not yet paid any compensation for these claims.

In January, the FSCS declared two BSPS advice firms in default, Channel One Financial Planning and Argent Wealth

Last week, the FCA confirmed its plans to move ahead with the proposed British Steel redress scheme which will cover steelworkers who transferred out of the scheme between May 26, 2016 and March 29, 2018.

In a consultation paper, the FCA estimated that 1,400 steelworkers will receive £71.2mn in redress under the scheme. 

Redress represents a transfer to BSPS members who received unsuitable pension transfer advice from the firms that provided that advice, to the extent that they remain in business. 

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.

The debacle created a mountain of liabilities, which lawyers believe could end up costing the industry up to £300mn.

In September, the FCA and FSCS travelled to Swansea to meet steelworkers who could be due compensation but were met with mixed feelings, with some showing no interest while others claimed they were unable to book a place.

The City watchdog also travelled to Swansea in November to meet steelworkers about bringing possible claims against their adviser. 

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