Unsuitable pension transfer advice (Page v The Financial Conduct Authority)

Article summary

Pensions analysis: The ruling by the Upper Tribunal (Tax and Chancery Chamber) (UT) concerns the pension switching activities of independent financial advisers (IFAs) who outsourced their pension advice process to third party providers. This resulted in recommendations being made to retail customers to transfer their personal pensions into Self Invested Personal Pensions (SIPPs) that invested in unregulated, high-risk funds that were unsuitable for retail investors. The Tribunal held that the advisers acted in breach of Principle 1 of the FCA’s Statements of Principle for Approved Persons (APER 1). In the case of one individual who performed the CF1 director role, without the required approval from the FCA in breach of section 63A of the Financial Services and Markets Act 2000 (FSMA 2000), the Tribunal held that had he been approved he would have been found to have acted in breach of APER 1. The judgment also includes a wholesale examination of the case law on lack of integrity, including reckless disregard, as...