Emma RadmoreIt’s been a while since the last published notice, but FCA continues to take action against firms and individuals relating to pension transfer advice. It has fined Inspirational Financial Management (in administration), nearly £897,000 and has fined and banned one of its directors and one of its advisers.
The action relates to the firms’ pension transfer advisory work between June 2015 and December 2017. The FCA found the firm and the individuals failed properly to consider whether transferring out of DB pensions would be in the customer’s best interests. The firm charged by way of a contingent charging model, so that it would only get fees if customers decided to transfer out.
The FCA found that 83% of the firm’s advice did not comply with its minimum standards and that 261 of the 307 customers it advised to transfer out of their DB pensions did so. Arthur Cobill, an adviser, advised the majority of these customers, including nearly 200 British Steel pensioners.
The FCA noted that it will give preference to creditors ahead of its financial penalty on the firm. Additionally, it has banned Mr Cobill – who was the only pension transfer specialist at the firm – from advising on pension transfers and opt outs and he has agreed to pay £120,000 to the FSCS in lieu of a financial penalty. William Hofstetter was responsible for compliance oversight of the firm. The FCA has banned him both from holding a senior management position in a regulated firm and from advising on pension transfers and opt outs, and he will pay £40,000 to the FSCS.