An advice firm associated with the British Steel Pension Scheme (BSPS) has failed after the Financial Services Compensation Scheme received five claims.
As of last week (August 11), the FSCS said the Wales-based firm Financial Planning Practice was placed in default after having one claim upheld.
The firm received five claims in total, which are pension transfer advice and self-invested personal pension scheme related.
The FSCS also confirmed that the company is one of those associated with claims regarding BSPS.
The firm entered compulsory liquidation in October 2022 and wound up late last year, so it would not be subject to the s404 redress scheme from the Financial Conduct Authority.
The liquidator was appointed in February 2023.
The BSPS case
During 2017, BSPS members were asked to make decisions about their pensions as part of a restructure of the scheme.
About 8,000 members transferred out of the scheme, with transfers collectively worth about £2.8bn.
But concerns about the suitability of the transfers were soon raised, leading to an intervention from the Financial Conduct Authority that resulted in a number of advice firms – key players in the debacle – stopping their transfer advice service, while others went out of business.
The debacle created a mountain of liabilities, which lawyers believe could end up costing the industry up to £300mn.
The FCA announced last year that it plans to deliver £71.2mn in compensation to former members of the scheme who received unsuitable advice.
The scheme covers those who transferred out between May 26, 2016 and March 29, 2018.
However, in February this year a number of steelworkers wrote to the FCA expressing concerns about the regulator’s calculations for the scheme.
sonia.rach@ft.com
