Yorkshire-based Briggs Murray Financial Planning & Wealth Management and Newcastle-based Whitebridge Financial Planning have been declared in default by the FSCS. If you received advice from either of these firms, you could be owed compensation.
Both pension planning firms have been linked to the ongoing British Steel Pension scandal, which saw 8,000 workers transfer out of their defined-benefit pensions. Half of these transfers were unsuitable, with many British Steel workers losing out because of the transfers.
The FSCS has confirmed that both have open claims regarding the BSPS transfers, the bill of which the FSCS will now pick up.
Whitebridge Financial Planning was founded in January 2011 by Keith William Welsh and stopped trading in October 2018 as the result of insolvency proceedings started in 2017.
Briggs Murray Financial Planning was a pension specialist firm founded in October 2016 and was dissolved in October 2021.
Up to 31st March 2022, the FSCS had received 1,384 claims for BSPS transfers with some 781 claims completed. The FSCS has so fair paid out paid compensation for claims against 34 financial firms.
What happened with British Steelworkers’ pensions?
In April 2020, 8,000 steelworkers who transferred out of their British Steel Pension Scheme (BSPS) were encouraged by the FCA to lodge a claim against their financial advisers.
The financial watchdog found that nearly half of the BSPS pension transfers in 2017 were unsuitable. This was part of a market-wide study into the suitability of defined benefit (DB) pension transfer advice, with the FCA looking at 192 cases of transfers out of the BSPS.
The FCA found that 47% of cases were unsuitable for transfer, while 32% appeared to contain information gaps. Only 21% appeared to be suitable.
Issues first began to emerge in 2016 when British Steel owner Tata was looking to sell the business. The pensions scheme had to be separated from the business due to its large deficit. The Government and the Pensions Regulator allowed the formation of “BSPS 2” which would offer members a lower annual increase to their pensions.
Members were only given until the end of 2017 to decide whether they wanted to switch to BSPS 2, move to the Pensions Protection Fund, or transfer out of the scheme. Many members decided to transfer out of the defined benefit scheme after receiving independent financial advice.
Unions at the time, however, were very concerned that financial advisers were offering unsuitable advice and targeting the steelworkers.
Who are the FSCS?
The Financial Services Compensation Scheme (FSCS) is the UK's statutory deposit insurance and investors compensation scheme for customers of FCA authorised financial service firms. The FSCS will compensation consumers if a FCA regulated firm is unable to.
The FSCS enforces a levy on all FCA regulated firms which is paid into an annual compensation pot. The levy for 2021/22 is £833m. It has often been described as a “lifeboat fund” for consumers who deserve compensation after a mis-selling or negligent financial advice.
It is independent of the Government and the financial industry, and was set up under the Financial Services and Markets Act 2000, becoming operational on 1 December 2001. They do not charge individual consumers for using their service.
Did you receive advice from Briggs Murray or Whitebridge?
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