As expected the news was dominated by politics this week, which reached boiling point on both sides of the pond amid Brexit rows and impeachment proceedings.
But advisers have also had a heated week as the compensation scheme received 32 complaints against one advice firm, they were warned against submitting claims and platform Aviva was accused of poaching their clients. It’s time for the week in news.
1 Clients poached
A few emails caused big problems for Aviva this week when the firm was accused of “client poaching” after it emailed several adviser clients asking them if they wanted to move their pensions onto its platform.
One adviser told FTAdviser Aviva had emailed himself and a number of his clients, informing them their off-platform pension had reached a “milestone” and offering them the chance to use its platform to switch investments or access Aviva’s retirement products.
The adviser, Gary Friel at Kent Insurance Services, said the clients’ current products remained “fit for purpose” and thought Aviva’s “obvious aim” was to get them into direct engagement with its pension sales team.
Aviva denied any attempts of client poaching and said there was no suggestion in the letters the clients should seek advice from an alternative source.
2 Claims galore
Figures published this week showed a hefty 32 claims relating to Sipps and pension transfers against Omega Financial Services have been received by the Financial Services Compensation Scheme.
The Blackpool-based firm, which was told to cease all pension and investment business by the regulator last year, was declared in default in August.
Three claims have been paid so far, denting the FSCS to the tune of £113,000, while the other 29 are still being assessed.
The FSCS has also paid claims of a similar value against another advice firm, Plymouth-based Leech & Burgess IFA LLP, which it declared in default last month.
3 Happy taxman
New data revealed the number of savers being hit by pension tax charges was on the up as more people than ever have been levied tax on their contributions.
The numbers from HMRC showed £812m worth of contributions had exceeded the annual allowance limit in 2017/18, averaging £30,584 per breach.
A total of 26,550 people reported such a breach — up 11,000 per cent in a decade as just ten years ago a mere 230 faced the tax charge.
Industry experts blamed the significant increase on the introduction of the tapered annual allowance in 2016.
Those affected face a potential tax charge of 40-45 per cent on their savings if they fall in the higher income brackets.
4 To claim is no game
Advisers who help their clients submit claims could be playing a risky game if they don’t have the correct permissions, the Personal Finance Society warned this week.
Although advisers have been urged to help bring claims to the regulatory bodies for free in an effort to push back against claims management companies, the PFS said there was a risk the new regime to regulate claims managers, enforced by the FCA earlier this year, could catch advisers out.