Pensions 

Trouble for FCA chief and a Waspi win: the week in news

Trouble for FCA chief and a Waspi win: the week in news

Europe dominated the news this week as the UK secured last place in the esteemed Eurovision contest and MPs successfully convinced Theresa May to resign over Brexit.

Closer to home, MPs also called for the Financial Conduct Authority’s chief to resign and pension reforms hit the headlines. It’s time for the week in news.

1 Chief in hot water

More than a dozen MPs called for Andrew Bailey to resign from his position as chief executive of the FCA for his part in "presiding over the biggest financial scandal in recent years".

The calls were made in relation to the collapse of mini-bond holder London Capital & Finance, which went into administration in January owing more than £230m and putting the funds of some 14,000 bondholders at risk.

The firm was authorised to promote the mini-bonds which MPs claim enabled the company to "raise money from bondholders”. 

An early day motion calling for Mr Bailey's resignation over the issue has now been signed by 16 MPs, expressing "alarm" over concerns the regulator did not act quickly enough to identify and act upon problems in the firm.

2 Blast from the past

Advice company Insight Financial Associates was ordered to pay compensation to an insistent client for transferring her pension benefits to a self invested personal pension.

The Financial Ombudsman Service found the adviser should have properly protected the client from the investment, which was too high risk for her.

This was after it heard that the client had been told by Harlequin the suitability reports were 'standard practice' and were to be ignored.

Insight argued that no advice had been given to the client to invest in Harlequin and a letter signed by the client in January 2011 set out the adviser’s recommendation not to proceed with the transfer.

However, the Fos said that Insight should have declined to arrange the Sipp transfer regardless.

3 A Waspi win

A United Nations independent expert said changes to pension policy which penalised women born in the 1950s should be rectified to remedy the "systematic disadvantage" they created.

In his final report of his visit to the UK, the UN special rapporteur on extreme poverty and human rights, Philip Alston, said the government should "review and remedy the systematic disadvantage inflicted by current policies" on women, as well as on children, persons with disabilities, older persons and ethnic minorities.

This followed his initial statement in November when he noted that women born in the 1950s had been particularly impacted by a "poorly phased in" change of the state pension age. 

Mr Alston noted that the policy change had "severely and unconscionably penalised those who were on the cusp of retirement and who had well-founded expectations of entering the next phase of their lives".

Campbell Robb, chief executive at the Joseph Rowntree Foundation, said there could be no moral justification for failing to act on the report.