UK - Independent financial advisers will be fined and firms closed down if they give poor pensions advice, the Financial Services Authority's new chairman has warned.
Callum McCarthy – in his first speech as chairman – said the regulator would take a “tougher” stance on IFAs who did not give workers sound financial advice.
This will include preventing firms from conducting regulated business if they breach guidelines such as failing to comply with ombudsman awards and “not co-operating” with the FSA.
McCarthy – speaking at the Association of Independent Financial Advisers’ dinner – said: “We are pursuing means of separating sheep from goats – and making bad behaviour expensive.
“It is in the interest of all reputable IFAs that effective action is taken against any disreputable or irresponsible actions by an IFA. And there is no more important task in financial services than helping people make plans for their retirement.”
McCarthy said tighter controls were particularly important given the switch by many employers from DB to DC schemes. He said this forced individuals to make key decisions about their retirement, increasing the need for “responsible” advice.
“Far too many individuals are ill-equipped to make the decisions they are increasingly being asked to make.”
Most respondents in this week's Pensions Buzz do not think businesses should be able suspend AE contributions if in financial distress.
Former BHS owner Dominic Chappell has lost the appeal against his section 72 conviction and sentence for failing to hand over information to The Pensions Regulator (TPR).
This week's top stories include Marsh and McLennan Companies agreeing to buy JLT, and the home secretary calling for AE to be scrapped in a no-deal Brexit scenario.
Lesley Titcomb says the watchdog wants closer interactions with pension funds to spot problems sooner and act before having to use its more stringent powers