Where am I? 
Home Pensions - Retail
Categories: Pensions - Retail
Tags:Technology| FSA| prudential| fines| pension transfer
Many advisers have not been properly trained to use pension transfer tools, despite massive uptake in their use since an FSA review in 2008.
Prudential says advisers are clamouring for new software tools following a number of high profile pension switching fines, but believes many are not receiving the required training to use the tools effectively.
Vince Smith-Hughes, head of business development at Prudential, says he has seen great appetite for pension transfer tools at a series of recent roadshows, but says many advisers are not using the software effectively.
"We spoke to IFAs who were advised to use specialist tools by their networks, but many hadn't been properly trained to use them, and could still trip up when the FSA calls to examine their case files," he says.
Failing to properly compare prices on a ‘like-for-like' basis and not taking commission payments into account were key issues, he adds.
Meanwhile, a recent survey of over 200 advisers found almost half did not have a single coherent process for pension switching advice.
IFASurveys.co.uk found advisers were not being deterred from pension switching advice despite fines, with 70% saying they were ‘unconcerned' about the FSA's thematic review of pension switching.
This comes despite substantial fines for Financial Ltd and RSM Tenon for poor systems and controls on pension transfer business.
Paul Cadde, managing director of IFAsurveys.co.uk, says: "How any adviser can have no formal pension switching process after recent events is alarming.
"The FSA have come down hard on advisers whose processes are inadequate and require that every adviser has a robust and repeatable process in place to give consistent and high quality reporting to each client where a switch is advised."
| Comment | Advisers risk fines from poor pension switch training |
Related articles
From IFAonline
Categories
Tags
Comments
we don't work for the regulator
"a recent survey of over 200 advisers found almost half did not have a single coherent process for pension switching advice." This could be because each case in which a transfer is made is dealt with on its own merits and using the particular comparison method and rationale which should be applied to its case in particular. The FSA checklist is NOT one which can be applied across the board -instead it tries to fit all cases into a template which will in pratice perhaps suit a regulator but will not do the job for the client. IFA's have an overarching duty to do the best for the client-this duty sits above any duty to make life easier for a regulator.
Posted by: snooks
Not just pensions
Pensions may be more complicated but the requirement for cost comparison and justification of addtional cost arises on any replacement business, not just pensions. My experience from talking to a lot of IFAs is that this message is still not understood, let alone being acted upon, by a significant swathe of advisers - hence the FSA geting tough, how else do they get the message across?
Posted by: Stan Kirk
be fair
Stan When you say this "My experience from talking to a lot of IFAs is that this message is still not understood, let alone being acted upon, by a significant swathe of advisers - hence the FSA geting tough, how else do they get the message across? " you are giving anecdotal and subjective evidence to back your own opinion. The FSA tend to do that as well - that is base a policy or an action on a less than objective less than sound analysis of IFA and/or client behaviour. That isn't good policy surely and it can't be good use of public funds. It may well be that if an objective analysis was properly carried out of the quality of advice and recommendations and their cost the FSA might find that concentrating their resources on where teh majority of consumer detriment is taking place leaves IFA's to get on with treating their clients fairly which is what 'in my experience' exactly what we have been doing even before the phrase was coined.
Posted by: snooks
Related articles
Most Read
Audio / Visual
With the industry's biggest fund managers, IFAonline welcomes you to the media centre.
Ensure you never miss another story by following IFAonline regularly updated news feed on Twitter.
Events
Poll
|
|
Related Information
Job search
Adviser Careers will open the right investment career path for you. Search hundreds of vacancies on www.advisercareers.com now
In Focus
In these uncertain times, clients now require more so than ever to know that their SIPP investments are generating the best possible return to secure their retirement.
Viewpoints
Clients now have a growing need for choice, flexibility and transparency when it comes to Personal Pensions.
sponsored by
And at retirement
Never forget that these rules apply at retirement. I suspect many advisers - including provider direct operations - are not looking at a ceding scheme in this way when they execise OMO. It is absolutely clear to me that these rules apply equally at retirement but this never seems to get publicity. We had a case this month where a provider did not correctly identify protected tax free cash and tried to sell OMO with 25% cash.
Posted by: Bob Bullivant