PensionsJun 15 2018

Sipp claims on hold and fraud charges: the week in news:

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Sipp claims on hold and fraud charges: the week in news:

Another week, another twist in the pension mis-selling tale, amid criminal charges for a former wealth planner and heavy criticism for life insurers who refuse to update their legacy policies. Here is the week in news.

SIPP cases put on hold

Self-invested personal pension mis-selling cases being handled by the Pensions Ombudsman were held up yet again this week, after another legal challenge led to it putting cases on ice.

The ombudsman service had been processing claims right up to proceedings being filed in the Adams vs Carey Pensions case, which is currently awaiting judgement.Like the Berkeley Burke case, which also involves the FOS,

The cases centre on the question of whether a Sipp provider can enter into an execution-only contract with clients. Fos is not halting cases, however.

Fraud charge for Freddy

Freddy David, managing director of the collapsed London wealth management firm HBFS, has been charged and released on bail with an order to appear at the City of London Magistrates Court early next month.

He is charged with obtaining money transfers by deception and fraud by abuse of position.

HBFS collapsed in March this year, and according to reports owed £13m to clients at this point. Another man who had been arrested at the time has been released with no further charges.

Wowcher pension deal draws criticism

Would you pay £12 for a pension review?

Group-buying website Wowcher offered just that this week - a voucher from Charles Derby, a member of the Intrinsic Network - for an one hour in person or over the phone.

The bold move has divided the adviser community; with some calling it innovative and others concerned it falls foul of Retail Distribution Review rules.

Charles Derby said the consultation was really worth £295, and said the voucher was a way of attracting people who wouldn’t normally take advice. But critics dubbed the ad ‘salesman tactics’, and said you couldn’t give decent advice for £12.

More than 250 people bought the voucher, but if you fancy paying a financial adviser £12 an hour, you’re too late if you want to take Charles Derby up on the offer, as it has now expired.

It’s a drawdown shambles

Advisers took aim at life insurers this week, saying that they should have updated their systems to reflect the fact that customers no longer have to buy an annuity at the age of 75.

The problem stems from legacy drawdown plans, which according to their trust deeds finish when the policyholder turns 75.

Advisers argue old life companies have refused to update their systems to allow contracts to continue past that age, and say that they incur extra cost and more work from having to switch clients into newer policies.

But while advisers describe the situation as “nonsense” and “a shambles”, providers say that customers can transfer to modern drawdown policies without charge. Some, like Zurich, Prudential and Scottish Widows will not accept business into modern drawdown without advice, however.

Computer can’t say no, after GDPR

As we all take a deep breath in the wake of GDPR implementation on May 25 and clear our inboxes of all the junk that preceded it, yet another unintended consequence of the new data rules has come to light.

People who are told by a computer that they aren’t eligible for a mortgage, credit card or loan will be able to  challenge their bank's decision and demand it should be reviewed by a human.

While GDPR does not prevent banks from using automated processes but it requires firms to alert their customers to such processes and have appropriate services in place for them to appeal.If enough people do so, some experts believe that banks could stop turning people down due to small misdemeanours such as CCJs on their credit files.Makes all of those emails clogging up your inbox seem worth it after all, doesn’t it?