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Adviser involved in £11m claims now runs CMC

Adviser involved in £11m claims now runs CMC

A financial adviser whose advice company went into liquidation and has prompted £11m of payouts from the Financial Services Compensation Scheme is now running a claims management company.

Dominic Barry's latest venture is ARB Group, which trades as The Financial Compensation Service and is based in Newport.

The Financial Conduct Authority took responsibility for authorising claims management companies this month and Mr Barry's firm has been listed on the regulator's register and given temporary permission - though Mr Barry himself is still listed as "inactive", meaning he was previously listed as an approved person.

Mr Barry was previously a director of Blueinfinitas which went into liquidation in 2015.

He told Financial Adviser he was left with "no choice" but to leave the financial advice profession because the Financial Conduct Authority wanted his company to complete a section 166 review which it could not afford.

Mr Barry went on to say the fact that this review had not been completed, coupled with negative press coverage in Financial Adviser, meant he "found it hard to alter firms' preconceptions" of him.

Last year he became a director of ARB Group, which states it will help those affected by the "ongoing pensions scandal" of companies moving savers' pensions to "unsuitable high risk investments".

A spokesman for the FSCS said most of the claims it had received relating to Blueinfinitas were related to unsuitable advice, with the "vast majority" of those being for Sipps.

The Financial Ombudsman Service has adjudicated on two complaints against Blueinfinitas.

Both of those decisions, which were reached in December 2015 and January 2016, related to transfers into self-invested personal pensions and both ruled Blueinfinitas gave unsuitable advice.

One related to a man who was advised to transfer £64,000 into a Sipp, investing £33,000 in an unregulated property investment called Windermere Hydro Hotel, while the other saw £57,000 transferred into a Sipp and £29,000 invested in an unregulated property fund.

Mr Barry said: "When my previous business entered the Sipp market, I had the support of compliance, Sipp providers and brokers, all being happy with the proposition as a suitable strategy. 

"Ultimately, the firm gave the advice and was culpable as the regulated advisory party, but it wasn’t the entity that sought to take advantage of retirement pots in a detrimental way. These are the entities that are causing the far deeper rooted problems in this market."

But Mr Barry did not clarify which entities he was referring to.

He said those suggesting his current company was profiting from the kind of error his former advice company made would "deny him a living".

Mr Barry said: "I went through a rigorous application and interview process with the Ministry of Justice, leading to my authorisation. Whilst my experience and that of my firm's clients was negative, I am able to take that knowledge and experience to help people, many of whom are not even aware of issues with their pensions.