British Steel pension mis-selling solicitors

Complaints against financial advisers

Several firms advised steel workers to transfer out of the British Steel Pension Scheme (BSPS) and into personal pensions, instead of opting for BSPS 2 or the PPF.

In personal pensions, steel workers’ retirement savings will now be subject to various risks, charges and inflation and exposed to the uncertainty of the markets. Those we have met weren’t properly advised how the reality of personal pensions compared to the benefits they would have from BSPS 2 or the PPF, or that they were very likely to be worse off.

We are acting against over 40 firms who advised on transfers and we represent hundreds of British Steel workers who are claiming compensation to try to rebuild their retirement savings, including many who had been advised by Crescent Financial, a trading name of S&M Hughes.

To date we have recovered over £2.3m for former members of the BSPS.

What was wrong with the pension advice given to steelworkers?

I have sat down with lots of steelworkers in our Port Talbot office and I’ve been shocked, sometimes appalled, at the conduct of some advisers in the area. Often, advisers reduced their fees used pushy sales techniques to encourage transfers. In lots of cases, meetings with clients were only 30 minutes with a recommendation to transfer was given there and then. In my view, it’s impossible for an adviser to gather the information they need, analyse it and make suitable recommendation in that time, and I think most people would agree. The FCA, for example, expects a single pension transfer to take around 25 hours, accounting for the time spent properly understanding a client’s position and plan for retirement, and analysing and explaining their options carefully.

Some steel workers me and my team have met weren’t asked about their retirement plans at all, and many received little or no explanation of BSPS 2 (details of which had been available since May 2016) or the PPF. I have also seen papers in advisers’ possession at the time they advised steel workers which suggest they knew their steelworker clients were very likely to be significantly worse off in retirement, but advisers led those individuals to believe otherwise and didn’t show them the figures. Some advisers even wrote suitability letters and attendance notes confirming conversations with steel workers they had never even met.

Unsure if you have a pension transfer complaint against an adviser?

In terms of being unsure, a common misunderstanding I see among the steel workers I meet is that, because they told their adviser they wanted to transfer their pension, they do not think they were misadvised and therefore do not believe they have legitimate grounds to make a complaint. In all likelihood, that’s not the case. In the same way that a doctor will not prescribe medicine simply because you ask for it, a financial adviser must not simply act on clients’ preferences or requests when advising on pension transfers – they must act in their clients’ best interests.

Even if you had it in mind that transferring was the best thing to do, your financial adviser still had to consider your circumstances in detail and make a recommendation which was suitable and in your best interests. In almost all cases, transferring into a personal pension instead of opting for BSPS 2 or the PPF, will not have been in steel workers’ best interests, and they are very likely to be worse off when they come to retire as a result.

Is your adviser putting you off making a pension transfer complaint?

We are very concerned about reports of certain advisers in the area taking steps to deter their clients from making complaints, such as confirming that the FCA has confirmed their transfers were correct, or otherwise persuading steel workers that their advice was ‘right’. If all advice to transfer was right, the FSCS would not have paid out £2.3m in compensation.

Perhaps most concerning were the reports to me that one adviser was threatening counter claims against any of his clients who made a complaint against him – that is desperate and nonsense. We want to prevent steel workers being mis-led again by those advisers. If you are at all unsure whether you should have transferred, please feel free to get in touch.

How we can help?

Alongside Al Rush we have campaigned to expose and address the failings which led to so many steel workers being poorly advised to walk away from valuable, guaranteed pension schemes, and we’re working hard to ensure that steel workers are properly compensated. Having a solicitor’s assistance is not a requirement when claiming compensation, however, it could be beneficial.

We have already recovered over £2.3m in compensation for former BSPS members , but it would have been much less had firms not challenged the Financial Services Compensation Scheme’s (FSCS) calculations when errors were identified.

In one recent case, the FSCS awarded one steelworker nothing in the first instance, but after that decision was challenged by us several times, he was awarded £40,000. In another case, a steel worker had made an FSCS application with the help of his financial adviser and had secured £21,000 compensation. We were then appointed to consider the calculation and compensation awarded – we secured a further £29,000 of compensation for our client as a result of challenging the FSCS. We continue to press the FSCS to compensate clients properly.

All steel workers in any doubt about whether they might have been mis-advised by any firm are very welcome to contact us – free of charge and without any obligation – to discuss their transfer.