I spent part of yesterday at a Pension Age conference and listened to a session on scamming from a well-informed lawyer. The talk revolved around the legalities of red and amber flags, whit lists and the role of MaPS in preventing people transferring DC pots from one platform to another.
Meanwhile in a less luxurious spot han the Waldorf Hotel, this interview was taking place.
Once again, Al Rush is on it, well done MP Nick Smith.
So what’s happening?
Some time ago, the FCA announced a £70m compensation scheme , designed to give “redress” to steelworkers who had wrongly been advised to leave the British Steel Pension Scheme and transfer money to personal pensions.
The redress was to be calculated by the financial advisers who mis-advised and paid by them either as cash or into a restitution scheme (which has yet to be put in place). A restitution scheme is being discussed by TPR and FCA but discussions are….slow.
Meanwhile, the redress calculations are proceeding at breakneck speed. After 6 years of waiting for their complaints to be dealt with , the redress letters are arriving thick and fast.
The £70m compensation ticket has been revised down to £45m but at this rate, compensation will be nugatory.
This is typical of many posts on the steelworker’s Facebook group pages
I have just had my redress info from IFA. They found ‘yes’ I had bad advice. But I am not out of pocket, so no compensation.
I know annuities are high at the moment.how has other people redress calculations been ?
The IFA followed the FCA’s spreadsheet apparently.
The sudden surge of activity amongst the previously lethargic advisers is connected to the surging annuity rate which governs the redress calculation. Once again, “marked to market” valuations of liabilities – relying on gilt rates, are being used against steelworkers. The IFA taketh and taketh away again.
This is what MP Nick Smith has been discussing with Amerdeep Somal, the complaints commissioner for the Bank of England , PRA and the FCA.
She is also incoming Chair of Board for the Law Society England and Wales. If you want to escalate , you escalate to her.
Decency and perspective
As I sat in my plush seat in the Waldorf Hotel , I was following the conversation of the steelworkers. My perspective to the conference speaker was a few yards, the steelworkers were in Scunthorpe and Port Talbot.
It seems indecent to me that we focus on technicalities of law when the realities of pension scamming go unremarked. Over 3,000 of the 7,000 steelworkers who transferred were ill advised yet all the redress calculations are coming back with an acceptance of guilt but zero compensation
Despite the distress of the last six years, the ceaseless form filling, the raising of expectations and the dashing of expectations, the steelworkers hardly ever had this compensated. The new redress system makes such compensation even less likely
We have lost all perspective, it is indecent that the steelworkers and other scam victims languish while lawyers argue details on the head of a pin in luxury hotels.
“It’s affecting people’s lives…”
I asked a question of the lawyer presenting. I asked whether it was fair that one steelworker should be given £60,000 three years ago and another -with an identical claim, should be given nothing today. Predictably the response was that the solicitor could not comment on particular instance.
“was it fair that a change in annuity rates resulted in two claims, submitted at the same time, should result in such different settlements?”
The answer came back “no- it was unfair“.
So long as we allow redress to be determined by means of arcane financial measures linked to gilt-based discount rates, we put the victims of scams at risk of gaming. By giving the timing of the calculations to the people paying the compensation , we put the wrongdoers in charge of their victims. It is against all the principals of justice.
Which is why I am so very pleased that a Judge of Amerdeep Somal’s standing is getting involved.
Many thanks to Al Rush for championing this , to Nick Smith for his ongoing support and to the many tough steelworkers who refuse to get ground down by a system that seems set against them.
This is the tone from the steelworkers, it is a little more real than that at the Waldorf Hotel.
“Had this back from solicitors today, its a crazy situation.
Further to my below email and our telephone conversation at the end of last week, I have now heard back from the FOS. Unfortunately, the response from the FOS is that they have already asked XXX to recalculate using the calculator and they cannot force XXX to redo the calculation if they refuse (as they have done). The FOS have said we need to contact the FCA if we have concerns about how XXX are conducting themselves. I am therefore going to write to the FCA.
I will keep you posted.
Kind regards “
I wonder how helpful the FCA will be now…………… ? When i asked both parties at the Aberafan hotel FCA event i was thrown pillar to post between them (FOS to FCA) FCA to Fos, and neither of them could help or knew anything………Surely this will come to some conclusion soon, its been years and affecting people’s lives.