Laura WilesThe FCA has banned and fined a director and financial adviser in relation to pension transfer advice failings.
Richard Fenech was the sole director of Financial Solutions Midhurst Limited (FSML), responsible for overseeing Heather Dunne, FSML’s appointed representative (trading as HDIFA). They have both been banned from working in financial services, and fined £270,646 and £399,817 respectively. The FCA found that they operated a flawed advice model, putting customers’ guaranteed pension benefits at significant risk. It also found that Dunne failed to act with due skill, care and diligence when providing pension transfer advice.
Dunne failed to take into account the destination of the customers’ investments when advising on the suitability of defined benefit pension transfers. The flawed two-adviser advice model featured Dunne providing the pension transfer advice, with another firm providing investment advice on the proposed onward investment. Therefore, Dunne did not know where her clients’ money was going when advising on the transfer, leaving customers exposed to the risk of unsuitable pension transfers.
Fenech was responsible for the oversight of HDIFA’s business. However, although he was made aware by FSML’s external compliance consultant of the risk arising from the two-adviser model, Fenech did not prevent HDIFA from operating it. He also failed to ensure that Dunne’s advice complied with regulatory standards.
The FCA found that both Fenech and Dunne also failed to act with integrity because of their involvement in dishonestly providing a backdated appointed representative agreement to the FCA.