Have you advised on British Steel pension transfers? Action required!

Firms who have advised clients to transfer away from the British Steel Pension Scheme (BSPS) should be well acquainted with the content of PS22/14 by now …


… but some don’t seem to be aware that they need to have completed some key activity for clients in scope of the redress scheme.

The BSPS Redress Scheme covers consumers who were provided with advice to transfer out of the BSPS between 26 May 2016 (the date the DWP launched its consultation on BSPS) and 29 March 2018 (the date the BSPS entered the Pension Protection Fund) and PS22/14 outlines the steps firms need to take in relation to clients within scope of the scheme, which commences on 28 March 2023.

A flowchart, which starts on page 10 of the Policy Statement confirms that firms with clients in scope of the redress scheme, provides timeframes for specific activities that FCA expects firms to take.

By 28 March 2023 firms must have identified all clients who were advised to transfer out of BSPS and from these must identify all those who fall within the scope of the redress scheme.

By the same date firms must write to all clients (within and outside of scope of the redress scheme) to advise them that the firm will be performing a review of the advice they provided in relation to the transfer, unless the client decides to opt-out. They should also confirm that even if the advice falls outside of the scheme, that the client may still be able to complain in certain circumstances.

Clients who do not receive the letter by 28 March are advised to contact the FCA directly, so firms would be wise to issue the letters.

Acknowledgement of a client’s decision to opt-out of the scheme must be provided within five business days.

The flowchart then spells out the actions required by firms with a further deadline of 28 September. We will provide a further reminder nearer that time.

Important Note: ATEB news is intended to provide general information ONLY. The content, including any views expressed or guidance provided, does not replace the need to comply fully with FCA Rules and Guidance. Unless you have discussed news article content with ATEB, and specifically how it relates to your circumstances, then ATEB disclaims all liability and responsibility and actions arising from any reliance placed upon it. For the avoidance of doubt therefore, any reliance you place on such information without our consultation is at your own risk.

ATEB Compliance offers compliance and regulatory advice.

ATEB Suitability provides report writing software for the financial services market.

Our View

This is important and affected firms that haven’t yet completed this activity could be sleepwalking into a problem. The FCA is monitoring BSPS advice extremely closely and we don’t think that firms can afford to fail to comply.

Action Required By You

If you haven’t already, deal with the actions outlined in the flowchart within PS22/14. This isn’t optional!
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About the Author

Paul has in-depth experience across a wide spectrum, having headed up compliance, T&C, monitoring, oversight and MLRO functions previously. He was also an IFA for some time so can see things from more than one angle.

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