Financial Ombudsman Service have criticised Intrinsic over UCIS advice.
The Financial Ombudsman Service (FOS) have taken Intrinsic to task after finding that it had given bad advice in a number of pension transfer cases involving unregulated investments.
Only last month, it was reported that Intrinsic had lost 5 individual complaints where the claimants transferred their pensions into a self-invested personal pension (SIPP) leading to investment in unregulated schemes with Sustainable Growth Group and two claimants even invested in Global Forestry.
The FOS have published three more decisions with the claimants raising similar issues over the advice they had received from an appointed representative of Intrinsic to transfer their pension.
In each of the cases, the claimants transferred their various pensions into a SIPP and subsequently invested in unregulated and illiquid schemes such as green oil and forestry based investment schemes which failed later on.
The FOS ruled in all three cases that Intrinsic was responsible for the advice the claimant received, despite it being done through an appointed representative.
The FOS said in each claim, the advice to transfer to a SIPP could not be considered in isolation and should have taken into account what investments were to be held within the SIPP.
Ombudsman Philip Roberts said in one of the cases: " I understand that the appointed representative tried to limit the advice given in this case. However, the adviser should have considered the suitability of the overall transaction.
"The adviser should have considered the proposed 'green oil' investment in ordered to be able to give suitable advice on the setting up of a new SIPP and the transfer of some of the existing pension funds to it."
He went on to say that if they adviser could not consider the investment they should have explained this to their client so they could have gone to another regulated adviser and got suitable advice.
In another case, ombudsman Michael Stubbs referred to a number of statements made by the Financial Services Authority in 2013.
One statement said: "It has been brought to the FSA's attention that some financial advisers are giving advice to customers on pension transfers or pension switches without assessing the advantages and disadvantages of investments proposed to be held within the new pension.
"Financial advisers using this advice model are under the mistaken impression that this process means they do not have to consider the unregulated investment as part of their advice to invest in the SIPP and that they only need to consider the suitability of the SIPP in the abstract. This is incorrect."
Even though this was issued after the advice was given by the adviser in this case Mr Stubbs said it had not been a new requirement but rather a reminder of what the rules in force at the time of the advice were.
Mr Stubbs asses: "Therefore, when giving the advice to transfer the defined benefit pension to the SIPP, the adviser should have considered the investments to be held within the SIPP.
"It is clear from the AR's version of events that he was aware that the purpose of the transfer to the SIPP was to enable investment in SGG products and Global Forestry."
Each of the three complaints were upheld as the purpose of the advice was to transfer to a SIPP to enable investment in the unregulated schemes, much like the five cases published last month.
Intrinsic was ordered to pay each claimant £500 for the distress and inconvenience caused.
The firm must also pay each claimant compensation after they lost a large proportion of their pension funds due to the unregulated investments failing.
Intrinsic re-branded as Quilter Financial Planning in July 2019 after its parent company completed the acquisition of Lighthouse in June.
Quilter did not want to comment on the FOS decisions as the cases pre-dated its acquisition of intrinsic in 2014.
If you have been affected by poor advice to transfer your pension into a SIPP or Unregulated Collective Investment Scheme or would like to make a general enquiry regarding poor advice causing financial loss, please get in touch with The Claims Bureau to find out what your options are.
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The information in this article was sourced from: https://www.ftadviser.com/sipp/2019/11/01/intrinsic-criticised-by-fos-over-ucis-advice/?page=1