Financial advisers have been told to record the clients’ own words in their files and do their best to show that the consumer understands the advice given, if they want to fend off potential complaints to the Financial Ombudsman Service.
Speaking at a webinar on defined benefit transfer advice organised by Prudential, Damian McPhun, partner at Beale and Company Solicitors, explained that the Fos' remit is to "come to a fair outcome".
As such they're not obliged to strictly follow the law or deal with it in a way that a court would, he said.
He stressed that advisers should make sure they don’t give the Fos any scope to find any problems in their advice process.
He said: "Make sure you got all the information [in the file], make sure you can show in it that the client understands, make sure you have taken all their circumstances into account, use the clients' own words - fully understanding and setting out 'I understand A,B, and C but I still want to do this'.
"If you got all that, then you can approach Fos with all the information and documentation you need to say: find any holes in this [if you can]."
Vince Smith-Hughes, director of specialist business support at Prudential, noted if clients are complaining it generally suggests "that they perhaps aren't understanding exactly the advice that has been given or the advice has been poor".
He added: "If advisers can improve their advice processes to further improve client understanding of the key risks, that should ultimately help to avoid complaints and claims to the Fos."
Mr McPhun said if the adjudicators and ombudsman can find a hole in the case that allows them to side with the complainer, they generally will do.
He noted this stance was "a bit sad" but said it meant advisers have to try to make themselves as 'bullet proof' as possible.
He added: "You often find that what starts as a fee or an investment complaint suddenly turns into Fos saying 'actually, going back a step, when you asked to do this transfer, we think ...' and suddenly it becomes a pension transfer [complaint], the figures go north and you are in all sorts of trouble."
Mr McPhun said the Fos was regarded "as the Russian roulette".
He said: "We normally say to clients they have a 70/30 chance in a normal case, and you don't get higher than that because of the litigation risk.
"But with Fos it will be very rare to say that you have more than a 50/50 chance, because there is that imponderable of how the adjudicator is going to respond to this, and that makes it quite difficult to deal with them."
A spokesperson at the Fos said: "Decisions about pensions are some of the most difficult choices people make, and it’s important that you understand the risks involved when investing your pension pot.
"If you’re unhappy with the outcome of your complaint, you can get in touch with us. We look at every case on its individual merits and we can help sort things out."