Sipps firm reacts as FCA told to probe 'unfair pension barriers'

The FCA must fire a warning to firms that barriers stopping savers accessing their pensions are unacceptable, the Government has commanded. The regulator should probe whether companies are breaching their responsibility to treat customers fairly, the Treasury has said.Economic Secretary to the Treasury Harriett Baldwin has written to chief executive Martin Wheatley on the issue.Yesterday, George Osborne told Parliament the Government would examine whether savers are being hit with unfair and excessive early exit penalties as they try to take advantage of the new flexibilities.Ms Baldwin said in her letter: “I am concerned that some providers may not be allowing consumers to access their savings even if they have met the regulatory requirements to seek advice and I welcome your agreement to investigate this further.“In the meantime, I trust that you will make clear to firms that putting unnecessary and unfair barriers in the way of consumers seeking to legitimately transfer their pension savings is not acceptable.“Where this is found to be the case you will no doubt wish to consider whether this could be regarded as a breach of their responsibility to treat customers fairly.”{desktop}{/desktop}{mobile}{/mobile}Mr Wheatley said he recognised the FCA had a key role to play and responded:“As you are aware, we are already monitoring how firms are implementing the changes and whether there is any impact on consumers.“Between now and August, the FCA will look to gather specific evidence relevant to the consultation announced by the Chancellor today, in particular evidence regarding the prevalence and level of exit fees and charges across the industry.“We will also explore further whether there are any unfair barriers facing consumers seeking to transfer.“This information will assist HM Treasury's consultation in determining whether any further intervention may be necessary.”Andy Leggett, head of business development for Sipps at Barnett Waddingham, said: "The FCA regulates personal pensions. Its rules on treating customers fairly include that there should not be any unreasonable barriers to exit. That covers practical obstacles as well as financial ones. As a crude rule of thumb, the older the personal pension, the greater the chance that there will be exit charges.“The Pensions Regulator covers occupational and workplace pension schemes. Its rules include time limits for completing transfers. In a number of recent Pensions Ombudsman cases, these have been breached as scheme trustees have been seeking to fulfil their obligations to tackle suspected pensions liberation."Speculating, if the Government believes that the application of such rules has been insufficient, it may look to make them more specific and demanding."

Sipps firm reacts as FCA told to probe 'unfair pension barriers'

Related items

News from Twitter