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Steelworkers pensions and fund losers: the week in news

Steelworkers pensions and fund losers: the week in news

This week there was a major break-through in Britain’s exit from the European Union when Foreign Secretary Boris Johnson promised that “cheapo stag dos” would still exist after Brexit.

Whether countries around Europe will still want to put up with our drunk young men is another matter but now it’s time for the week in news.

1) Steel-ing the FCA’s thunder

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It’s been a few weeks since there was any news about the British Steel Pension Scheme, which seemed too good to be true.

Now it’s back in the news after the work and pensions select committee published its report into the scheme.

It found many steelworkers were “shamelessly bamboozled” by financial advisers, with their pensions ending up in “unsuitable funds characterised by high investment risk, high management charges and punitive exit fees”.

Among its recommendations was a ban on contingent charging by financial advisers, which the Financial Conduct Authority has said is higher-risk but has not banned, though several advisers told FTAdviser they would support such a ban.

One thing the FCA did do this week was publish a letter it had send to all firms holding pension transfer permissions setting out what the regulator will be looking for as it widens its probe of pension transfer advice.

2) Not Bitcoining it in anymore

More bad news for bitcoin investors this week after the value of the cryptocurrency fell through the floor.

One bitcoin will now set you back less than £7,000 after it fell from a high of around £15,000 several weeks ago.

Those who have lost out have been warned that the tax man will not "come to the rescue" and allow them to offset capital losses, even though it is likely to tax those who gained.

Tax experts have said HM Revenue & Customs has not been able to provide a "definite answer" as to how it will treat people who cashed out in January.

This means HMRC appears to be treating cryptocurrency like an investment for the purposes of taking income tax or capital gains tax, but not treating it like an investment on the way out.

That’s the sound of cake being had and eaten at the same time.

3) Taking the Mifid

Mifid II is two months old but it's still causing headaches for fund houses and wealth managers.

They have been accused of ignoring the spirit, if not the letter of the law, when it comes to disclosing all of the fees charged to clients as required under the new rules.

Alan Miller, founder of wealth manager SCM Private, compiled the anonymised data which, he said, showed only 40 per cent of investment firms disclose all of the charges they are required to disclose on their websites.

The remainder either only make the data available via a third party data provider, or require an email from the client.

4) Big in Japan

Hopefully there weren't too many investors who opted for turning Japanese early this year.