Firstly, your Financial Adviser is responsible for providing you with financial advice, putting your best interests first. They must also advise you on the investments and plans, and provide advice that best suits your circumstances.
Above all, your financial adviser also needs to make sure that you have understood them fully and the advice. Your financial adviser must have clearly explained the risks involved in the advice. But sadly, many people have received poor financial advice and as a result, suffered unexpected pension losses.
For example, reported in the national media that Britain has been hit by a huge Pension mis-selling scandal. Thousands of Pension Savers have once again lost pension funds totalling billions of pounds due to poor financial advice.
In addition, different events spark new waves of mis-selling, for instance, the Pension Freedoms Act of 2015. Causing many savers with a final salary pension to be a target. Some advisers and introducers recklessly transferred these valuable pensions. These transfers were not always in the best interest of the saver. These transfers have left savers with significant losses, which means less money for retirement.
As a result, the Financial Conduct Authority stepped in and tightened the rules.
But there are still thousands of Savers who have been mis-sold a pension in the years gone by and are unaware.
A mis-sold pension means that the advice you received regarding your pension was misleading or unsuitable.
This could be that you were advised to transfer your pension into a new pension scheme, but the investments in the new scheme are much riskier than you were told they would be.
Or you may have lost out on valuable benefits that your previous pension scheme offered, because of the advice you received to transfer your pension didn’t make you aware of this.
If the pension advice was not right for you and your personal circumstances this could be pension mis-selling.
Financial Advisers have a regulated duty to provide you with as much information as possible about products and make you aware of all the choices available to you, including staying in your current scheme.
So, it may also be mis-selling if the way you have been treated as a client has breached the rules that apply to regulated firms.
To check for pension mis-selling look at the details of your pension transfer, such as the quality of the advice you received, which companies were involved and what investments are you in.
Some pension mis-selling has hit the headlines, so you may be able to see from searching the internet.
Most people who have been mis-sold their pensions will usually notice some unexpected losses to their pension fund.
If you have suffered a loss as the result of mis-sold pension advice, you may be able to claim compensation.
If you’d like some help with this, we do provide a free initial assessment. We can tell you over the phone if we think you have a case. No obligation to use our service, and we are more than happy to answer any questions you may have.
Recently, compensation awards have risen sharply. If your Adviser firm is still trading, the claim will likely be settled through the Financial Ombudsman Service whose maximum award is £375,000.
If they are not trading, the claim is likely to be settled by the Financial Services Compensation Scheme where there is a ceiling of £85,000. And, if your pension losses are greater than the award limits – you may be entitled to seek compensation against any other regulated firm involved, with an additional claim.
Here are 4 common signs of pension mis-selling:
1. Commission based “advice”
Any experienced financial advisor will use their years of experience and qualifications to find you the best products for your circumstances where necessary. Unfortunately, some sub-standard advisers select products for their clients primarily on the amount of commission they will receive. If you were advised to take out a pension product only to discover later that you were not advised in your best interests, you may be eligible for compensation as a result of pension mis-selling.
2. Advised to transfer out of a Company or Final salary pension scheme.
Many people have been advised to transfer out of their existing company pension to an alternate pension plan. This is usually considered bad pension advice; it is extremely rare that an individual would benefit from transferring from a ‘gold Standard’ pension with little or no chance of coming close the benefits of a Final Salary Scheme.
3. Hidden charges and fees
Many consumers are unaware of the actual costs of their pension scheme until it is too late. As a result, many people are saddled with fees that have a detrimental impact on the performance of their pension.
4. High risk and Alternative investments
Persuaded to invest in an alternative/unusual investment offering high or guaranteed returns? (more often than not based overseas). Unfortunately, these high-risk, too-good-to-be-true schemes are precisely that. For most investors, the only guarantee was disappointing returns and financial loss. If your returns were not honoured or you suffered a loss in relation to your investment, you could be entitled to compensation.
Costs and fees were not explained sufficiently
Funds were placed in unregulated high-risk investments you did not know about
The risks involved were not properly explained to you
Your attitude to risk or capacity for risk were not properly explored
Your personal circumstances were not duly considered
A ‘fact find’ exercise to determine your financial circumstances and retirement plans was not carried out adequately
You would have been better off with your existing pension plan
Get in touch with our claims team and we will be able to discuss the best options for you moving forward. You can contact our office from 9 am to 5pm or email us at any time and we’ll get back to you as quickly as possible.
The cost of our service is 15%+VAT of the gross amount of compensation offered in settlement of your claim. The maximum success fee we will charge is £7,500 + VAT. There is no charge for unsuccessful claims. You can withdraw your claim at any time, although a cancellation fee may apply.
We win more than 9 out of 10 claims.
You are not required to use our services to pursue your claim. You can also seek further advice or shop around subject to any time limits within which a claim must be made.
It is possible for you to present the claim for free, either to the firm or person against whom you wish to complain or to the statutory ombudsman (Financial Ombudsman Service or Pension Ombudsman Service) or the Financial Services Compensation Scheme, whichever is applicable to your claim.