One in eight people who received financial advice in the past 12 months claim to have been mis-sold an investment or pension product, according to a wide-ranging consumer survey by the Financial Conduct Authority (FCA).
In its Financial Lives Survey 2017 the FCA interviewed 13,000 people about their personal finances and found 13% of those who received advice in the past 12 months believed their financial adviser had at one point mis-sold them a pension or investment product.
The same percentage of people believed they had received bad advice unrelated to mis-selling either recently or in the past.
The numbers tell a similar story for those who received advice more than 12 months ago but do not currently have an adviser: one in seven (16%) believe they have been mis-sold a pension or investment product and one in five (21%) reckon they received bad advice unrelated to mis-selling.
But in reality the figures could paint an even more worrying picture, the FCA said: "The Financial Lives Survey 2017 did not investigate past perceptions of mis-selling or bad advice with other adults who may have had regulated advice in the past. Consequently, our findings will underestimate the proportion of all UK adults who perceive they have been mis-sold a product or received bad advice from an adviser."
Earlier in October the FCA found fewer than half of defined benefit (DB) transfers it had reviewed following the pension freedoms were deemed 'suitable'. The regulator had reviewed 88 DB transfers after October 2015 and decided 47% were suitable, 17% were unsuitable and the remaining third (36%) were inconclusive.
DB Pensions Least Trusted
In its survey the financial watchdog also asked consumers about how satisfied they were with financial products. Defined contribution pensions came second-to-last in the satisfaction tables and were the least trusted products out of a list of 22 different financial instruments that included credit cards and travel insurance.
Annuities and income drawdown providers faired much better, however, scoring 5th and 4th in the satisfaction ratings respectively and 7th and 4th in the trust ratings. Life insurance lagged down in 18th for satisfaction and 17th for trust.
Executive director of strategy and competition Christopher Woolard said the survey was about people's experience with financial services and products - not about economic facts. He said the data was being used to guide the FCA's focus.
The regulator also asked about unsolicited approaches in its survey and found almost one in five (18%) people had received calls, texts or emails claiming to be from the government, offering retirement planning advice or a free pension review.
On top of that, 8% had received requests to access their pensions in several ways.
Earlier this week, pension group Phoenix warned more of its customers were reporting approaches from unregulated companies aiming to obtain personal information or details about their pensions.
The group, which owns brands Axa, SunLife and Abbey Life, said it was not only the volume of approaches that was concerning, but the type of data being requested as well, adding one of its customers recently reported a cold caller visiting their home to get copies of their driving license, national insurance numbers, bank statement and pension paperwork.
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An amendment to the Pensions Schemes Bill which would have seen people given a pre-booked Pension Wise appointment ahead of accessing their retirement savings has been defeated.
A proposal to ensure savers receive a Pension Wise appointment prior to accessing their retirement pot has received cross-party support in parliament, while Labour seeks net-zero pensions by 2050.
Pension scams are not just about the money lost, but the lives devastated, says Nicola Parish, so the industry must unite to defeat this scourge.