The FCA, FOS and FSCS have published a report looking at the actions taken and results from the BSPS Redress Scheme exercise, as it comes to an end. Overall:
- £8.7m has been paid out by firms or the FSCS (significantly lower than the FCA’s original estimate of £50m, which it says is because of changing economic conditions as the expected cost of funding a guaranteed retirement income through an annuity has fallen);
- overall over £100m in redress has been offered to 1,870 former BSPS members;
- more than 6,500 former members have been supported by FOS, FSCS or the Redress Scheme;
- nearly 4,000 individuals were found to have received unsuitable advice; and
- FCA has so far banned 15 individuals and obtained money in fines or paid to the FSCS of £8.87m (although some are still under appeal).
The report shows that around 1,750 individuals received unsuitable advice but weren’t offered a redress payment because they had in fact not lost out financially – and the report recognises these individuals may be disappointed not to have received something, but the purpose of the scheme was to put them in the position they would have been in had they not acted on unsuitable advice.
The report also notes that although 7,700 members transferred out of the BSPS after receiving advice, many of them were not considered under the scheme because their adviser had already gone into liquidation, so these individual would have to claim on the FSCS. The report says that some have not yet contacted the FSCS.