The UK's Financial Services Compensation Scheme (FSCS) has declared nine financial advice firms in default in March, two of which advised on British Steel transfers.
Between 1 and 31 March, the lifeboat fund declared a total of 11 firms in default, nine of which were financial advice firms.
One of the failed advice firms, Bartholomew Hawkins, trading as Turris Porta Wealth Management, was ordered to cease advising on defined benefit (DB) transfers by the Financial Conduct Authority (FCA) in 2018.
We are reaching out to consumers to let them know that compensation may be available if they have suffered losses due to a failed financial services firm."
Following the attention the BSPS scheme has brought to DB transfers, the FCA said it had undertaken "significant information gathering" in order to identify firms that have been most active in advising consumers to transfer out of British Steel Pension Scheme (BSPS). Its entry on the FCA register said the firm must "cease all regulated activities relating to DB transfer business", effective from 22 December 2018.
The FCA confirmed to Professional Adviser at the time that the adviser firm had its permissions revoked because of transfer advice it has given to British Steel Pension Scheme members.
Another firm the FSCS declared in default that is associated with BSPS was Mansion Park Limited, trading as Mansion Park Scotland, trading as David Head MPL, trading as Michael J Alexander.
The firm offered the following statement when news of its transfer permission suspension first broke, confirming it had a visit from the regulator.
"Following this meeting we voluntarily resigned our defined benefit permissions (effective from 12 December 2017) whilst we await the FCA written feedback," it said in a statement.
"Early indications are that some of our implementation processes may need to be reviewed and strengthened. However, we do strongly believe that the advice we have given to our clients has always been well considered and suitable. We will implement any procedural changes recommended by the FCA to further improve the integrity of our business and to give peace of mind to our clients."
It added: "Mansion Park has only ever recommended that our clients invest in regulated funds with well-established mainstream UK based pension providers which are recognised as household names."
Of the nine firms declared in default by the FSCS in March, the other seven financial advice firms were:
- Active Finance
- Blakemore Wealth Management
- DK Consulting
- Estate Matters Financial Limited, trading as Pension Matters
- Hyde Financial Management Limited, formerly Imperial Wealth Management Limited
- Pentagon (UK) Limited, trading as MoneySaveSolutions.com, Eurodebt Financial Services
- Solicitors Financial Services (Central Scotland) Limited, trading as Equity Financial Services
The FSCS said that people who have dealt with any of these firms, and believe they are owed money, can now make a claim.
FSCS chief financial officer Fiona Kidy said: "FSCS is here to protect consumers across the UK and to contribute to financial stability.
"We are reaching out to consumers to let them know that compensation may be available if they have suffered losses due to a failed financial services firm. We are a free and independent service. Customers can claim directly with FSCS and we are proud of the efficient and easy-to-use service we offer."
In November and December, the FSCS declared 13 firms in default in the months of November and December 2020, six of which were financial advice firms.
First published by our sister title Professional Adviser