February, the month of romance, may be rosy for some, but it has been a troubled one for the government as the EU refuse to re-open negotiations.
For advisers, the week has brought a company collapse, crippling compensation and a busy regulator. It’s time for the week in news.
1) Going, going, gone
Consumer Wealth, a pension advice firm facing 13 complaints, announced that it had gone into liquidation this week.
Of the 13 complaints against the firm submitted to the Financial Ombudsman Service, only one had been decided on prior to its collapse.
It related to an investment in a fund run by Greyfriars Asset Management, which had seen its permissions restricted by the Financial Conduct Authority before becoming insolvent.
The complaint, which was upheld, was lodged by a client referred to as Mr F, who was advised to switch two personal pension plans, valued at almost £58,000, to a Sipp.
Consumer Wealth recommended that he invest 49 per cent of the Sipp into an equity fund and 49 per cent into the GAM Portfolio Six fund. The remaining 2 per cent was held in cash.
Ombudsman Keith Taylor found the GAM Portfolio Six fund was made up of "niche" investments such as overseas hotel rooms off plan, property development of grade listed buildings in Germany and the development of a waste treatment and energy recovery facility in Wales.
2) All is not lost for GP pensions
The British Medical Association (BMA) and NHS England proposed the option of a partial pension for GPs in order to help reduce the number of opt-outs at the scheme.
The solution of a partial pension – which already exists in the Local Government Pension Scheme – would allow GPs to halve the rate at which their pension builds up, and in return pay half the rate of contributions.
Concerns about doctors' pensions increased significantly since the introduction of the tapered annual allowance in 2016.
This gradually reduces the allowance for those with an income of more than £150,000, meaning they were more likely to suffer an annual tax charge on contributions and a lifetime allowance tax charge on their benefits.
3) Don’t worry, be happy…
…Or don’t be happy as the case may be for the Financial Conduct Authority, particularly when it concerns how Mifid II requirements are being implemented across the industry.
The regulator warned the absence of enforcement action under Mifid II to date does not mean the regulator is satisfied with how the requirements are being implemented by the industry.
Under the rules financial services firms must disclose a breakdown of actual costs and charges associated with the investments they sell to clients rather than estimates.
In the same week, however, the FCA was forced to admit it wasn’t perfect as the gender pay gap at the regulator worsened by 0.3 per cent over the year from 2017 to 2018.
At the end of last year the FCA stated it was "on track" to meet its gender and black, asian and minority ethnic (BAME) senior leadership targets over the next decade, but chief executive Andrew Bailey, while claiming it was heading in the right direction, said there was room for improvement.