Giant fund houses and pension drama: the week in news

BP Marsh & Partners stated its officials were working closely with LEBC's management to return the firm to “the position it was in before the FCA review”.

Kay Ingram, director of policy at LEBC, confirmed the decision but declined to give further details on the matter.

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4) "Mismanagement" of £14m funds sees pension company wound up 

In other pension news this week saw a company which managed two pension funds wound up by the court for failing to adequately look after £14m of members' funds. Ecroignard Trustees was wound up on Monday by the High Court in Manchester following an investigation which found the company had used pension funds to invest in illiquid, high-risk investments which were not suitable for the scheme members.

Ecroignard Trustees acted as the trustee for two pension schemes - The Uniway Systems Retirement Benefits Scheme and the Genwick Retirement Benefits Scheme, which involved 229 members and £14m in investments.

After receiving complaints, the Insolvency Service carried out an investigation into the company’s activities and found numerous instances of misconduct and instances where trustees had failed to comply with statutory requirements, best practice guidance and internal governance requirements.

5) FCA urged to ditch "complex" fees model 

Calls were made this week for the FCA to implement regulatory fees which reflect a percentage of turnover for advisers, in a bid to protect the future of the industry. 

Derek Bradley, chief executive of adviser forum Panacea Adviser, said he had been in frequent communication with the FCA to propose creating a flat levy of 0.5 per cent of turnover for all firms, rather than the often "complex" calculations he said were currently employed by the FCA. 

He claimed this flat percentage would help provide clearer projections for firms so owners would not fear having to end up out of pocket, while making sure that "polluters" do not end up putting a strain on finances. 

Mr Bradley said despite extensive communication with the regulator on his concerns, including with chief executive Andrew Bailey, he was concerned "nobody [at the regulator] seems to have grasped the idea of a flat percentage as I have proposed."

A spokesman for the FCA told FTAdviser: "We have engaged extensively with Mr Bradley, including explaining why it is not possible to carry out the calculation he has requested as we do not collect turnover data from all firms for fees purposes." 

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