Good news for steelworkers and bad news for Gareth Fatchett, his firm FS Legal and the IFAs that have been paying Fatchett’s legal bills.
Not only will they have to pay redress in full to ill-advised steelworkers – but they are now faced with picking up the majority of the FCA’s costs for fighting a spurious claim against redress.
We welcome the British Steel Adviser Group’s (BSAG) decision to drop the legal challenge against our decision to set up a redress scheme for former British Steel Pension Scheme (BSPS) members. Our view all along has been that the challenge was without merit and that we would vigorously defend the scheme.
This challenge has, in our view, been pursued unreasonably with little intention to go to trial so we are also pleased BSAG has agreed to make a substantial contribution to our costs. We have publicly warned and taken action against certain BSAG firms for making unsolicited offers to former BSPS members.
Under the redress scheme, firms have to review the advice they gave former BSPS members to transfer out and pay redress to those who lost money because the advice was unsuitable.
Fatchett has crashed into the ambulance that he has been chasing and not for the first time. In 2018 he and FS Legal found themselves in another ambulance-crash as they harassed a trustee of charity -LKP. LKP had resisted Mr Fatchett’s blandishments reporting
Since December 2017, Mr Fatchett has made repeated overtures to LKP to become involved in the leasehold scandal, proclaiming his professionalism and track record in similar class action cases.
However, Mr Fatchett was fined £2,000 with £9,250 costs by the Solicitors Regulation Authority last April for professional misconduct in misleading a court.
Fatchett, Gareth Ward – 026689
This outcome was reached by SRA decision. Reasons/basis Mr Gareth Ward Fatchett of FS Legal Solicitors LLP, 1 Hagley Court South, The Waterfront, Brierley Hill, West Midlands DY5 1XE agrees to the following outcome of the investigation into his professional conduct. Background As a result of a complaint to the SRA in September 2015, the SRA commenced an investigation.
The result of these vexatious actions of FS Legal and BSAG has been to waste the time and money of all parties but much more importantly , to inflict further distress on the victims of the scandal – the steelworkers denuded of guaranteed pensions.
If you are driving an ambulance in Brierley Hill, Port Talbot or Scunthorpe – beware.
Gilt lining
There’s more good new for miss-sold steelworkers who didn’t take compensation the advice of the BSPS action group to settle early for a pittance. They will not only enjoy full redress but will find it has gone up.
Higher compensation is due because the gilt yield has fallen in the last quarter from 4% to 3.75%. The fall in yield lowers the discount rate for compensation and increases the amounts steelworkers will be offered.
Unfortunately it seems that some steelworkers accepted to settle outside the redress scheme, scared by advisers telling them the redress scheme wouldn’t happen. The BSAG case was largely based on the short term spike in gilt yields following the autumn mini-budget which suggested that advisers had been right along. The FCA has shown interest in these out of redress settlements.
BSAG’s miserable behavior has only served to delay redress , if there is a gilt lining, it is that compensation looks like continuing to go up as interest rates fall.
The compensation is for events that happened six years ago, the most important fact is that 1400 steelworkers – whatever they are due – have still to get a penny.
So compensation which was originally estimated to be worth £71.2m and which fell in estimation to below £50m is creeping back upwards. No doubt a new estimate will emerge. None of these fluctuations make any common sense.
The FCA responds to 5 years of missed deadlines by missing another deadline.
Another thing that makes no common sense is the FCA’s failure to meet the 4 week deadline it has to respond to complaints made against it through the Financial Regulator Complaints Commissioner(RRCC)
With Al Rush and 600 other BSPS victims complaining about the delays occasioned by the FCA to the FRCC, you’d have thought the FCA would have been able to meet this deadline but no – three more months have passed with no action.
Get on with it
With the BSAG’s bluff being called , the stage is now set for the redress scheme to go ahead as planned.
The spring of 2017 was when the BSPS Regulatory Apportionment Agreement (RAA) was announced and this whole farrago began. Had the RAA never have happened , BSPS would have been in and out of the PPF and steelworkers would have no choices to make except when to retire.
All that has happened since has resulted from the complex settlement put together by corporate advisers with Tata and the Pensions Regulator. The FCA has not covered itself in glory, nor FOS nor FSCS. The complaints of Al Rush and the 600 victims to the FRCC remain unaddressed.
It really is time that we got on with putting this matter to bed.
Is there a similar redress system on LDI?
If not why not?
I must say Henry, and this is a personal observation, what struck me about the leasehold case, was the tribal-like conflict involving the different groups who seemed to spend more time scoring points off each other than challenging the builders and Government.
I’m a veteran of the Arch-cru campaign, did work on other financials, and in all cases, unity, shared purpose, and shared data works to get a result.
Is the next redress issue going to be for Members who have had their pensions bought out with a capped inflation increase when the Scheme had discretionary powers to enhance pensions in excess of the cap and that such an enhancement could have reasonably been expected to be funded on a self-sufficiency basis by the assets the Scheme used to complete the buy-out?