The Financial Conduct Authority has told another firm to stop doing overseas pension transfers.
The regulator has told Dubai-based Holborn Assets to “immediately cease” all regulated activity relating to pension transfer business introduced by overseas advisers until a skilled person has signed off the company’s advice process.
The watchdog's decision comes around a month after DeVere UK agreed with the FCA that it would stop providing third party companies with transfer value analysis reports.
As with DeVere, the FCA has not provided an explanation for why it has taken action against Holborn Assets.
But it has also ordered the company to carry out a past business review of all pension transfer business, including business introduced by overseas and UK advisers.
The firm must also appoint a skilled person to conduct all pre-sales monitoring for compliance against the regulator’s requirements for the pension transfer business referred to it by UK advisers.
Holborn Assets must also not dispose of, deal with or diminish the value of its assets without prior consent of the FCA.
The FCA has recently issued a warning about defined benefit transfers, which also mentioned overseas transfers.
The warning stated advisers should take into account the specific receiving scheme, including the likely expected returns of the assets and all the costs and charges, when deciding suitability.
Holborn Assets is an international financial advice firm based in Dubai with a UK arm based in Manchester.
In February DeVere reached a voluntary agreement with the FCA to “immediately cease to provide third party companies with transfer value analysis/defined benefit analysis (DBAR) reports or other similar report of information designed to assist third parties companies in transferring customers defined benefit pensions to an alternative arrangement."
At the time DeVere stated that as one of the sector’s leading providers of overseas pension transfers to international clients, it supported and welcomed the review.
Holborn Assets has been contacted for comment.
The FCA's action comes after earlier this month, a 25 per cent charge on Qrops was introduced in chancellor Philip Hammond’s first and last Spring Budget.
The charge aims to deter individuals looking to avoid tax by moving their pension savings to a different country.
The charge on Qrops will apply unless both the individual and the Qrops are in the same country after the transfer, or the Qrops is in one country in the European Economic Area (EEA) and the individual is resident in another EEA after the transfer.
damian.fantato@ft.com
