Having done our first post 1 October reviews of pension transfer cases this week, we spotted a misunderstanding of how the transitional period applies.
Cases we have looked at are still being charged on a contingent basis – all perfectly fine because they satisfied the criteria for the transitional rules …
“Where a firm can demonstrate that clients that have agreed contingent charges terms before 1 October and started work before 1 October, the firm may charge contingently, provided a personal recommendation is given before 1 January 2021 (i.e. within 3 months of the ban being implemented)”
However, the suitability reports did not include the required one-page summary. The firm thought the transitional period applied across the board. It does not. It only applies in relation to the charging basis and the requirement to compare a workplace pension. Other new rules, including the requirement to have a one-page summary and the new CPD requirements for Pension Transfer Specialists, apply as from 1 October.
Suitability reports – silver bullet, or not?
Paul Jay Compliance, Suitability DB Pension, FCA, MiFID, Pension, Pension Transfer, PI, transfer, Xplan
If you ask most advice firms which part of the advice process consumes the most time, most will reply: “Suitability Reports”. Based on the mammoth documents that some firms still produce, we can understand why. We do have some sympathy with firms though. On the one hand they’re told by the FCA that reports are […]