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British Steel: Active Wealth clients bought by ex-adviser's firm

British Steel: Active Wealth clients bought by ex-adviser's firm

The client bank of collapsed IFA Active Wealth has been purchased by another advice firm run by one of its former advisers.

Last Autumn Active Wealth found itself at the heart of controversy surrounding advice given to British Steel Pension Scheme (BSPS) members to transfer their pots by a number of different advice firms in South Wales. 

New Model Adviser® reported in November that the firm had agreed with the Financial Conduct Authority (FCA) to cease all pension transfer business, after concerns were raised to the FCA that Active had been offering unsuitable DB transfer advice .

Then last month the firm entered voluntary liquidation. Soon after the Financial Services Compensation Scheme (FSCS) announced that it was preparing to declare Active Wealth in default. Any successful claims against a firm declared in default will result in payments from the FSCS.

New Model Adviser® now understands that another advice firm with a personnel connection to Active, Fidelis, has purchased the good will and client base of Active Wealth from the liquidator, Derbyshire-based Crossfields.

Fidelis was incorporated in October 2016 as AWG Financial Ltd, by director Andrew Deeney, who held CF30 permissions at Active Wealth from February 2015 until December 2017, according to the FCA register.

The firm gained FCA authorisation in June 2017, and changed its name to Fidelis Wealth Management in December 2017. 

A lawyer for Fidelis said: 'From the end of 2014 Mr Deeney joined Active Wealth as a self-employed adviser bringing with him a number of existing clients.

'Mr Deeney was entitled, when he ceased working with Active Wealth and incorporated Fidelis Wealth Management in October 2016, to continue to advise those clients that he had built up while working with Active Wealth. Fidelis received FCA authorisation in June 2017 and agencies were set up with a number of different providers.' 

On 2 January 2018, Fidelis sent transfer of agency forms for multiple former Active Wealth clients to Sipp provider Intelligent Money. A transfer of agency would mean Intelligent Money recognising Fidelis as the adviser to these clients rather than Active Wealth.

Intelligent Money chief executive Julian Penniston-Hill told New Model Adviser®: 'We refused to accept these forms and terminated our agency terms with Fidelis. We then began to receive letters of authority from Fidelis on behalf of former Active Wealth clients seeking to transfer to other Sipp providers that would accept Fidelis as the adviser.' 

Fidelis' lawyer added: 'Mr Deeney sent transfer forms to Intelligent Money for his wife and two other clients that Mr Deeney had dealt with since 2010. Intelligent Money refused to deal with any transfers for which Fidelis had provided advice because of Mr Deeney’s prior involvement with Active Wealth.

'During December 2017 Active Wealth was contacted by a number of clients wanting to withdraw money from their Intelligent Money pensions and since Active Wealth was not authorised to advise, those clients were referred to Fidelis, after obtaining their prior express consent for contact details to be passed to Fidelis.

'However, since Intelligent Money cancelled the agency, Fidelis was not able to deal with Intelligent Money and all clients were advised to seek an alternative IFA.'

Active Wealth found itself the centre of attention when its managing director, Darren Reynolds, was invited to give evidence on British Steel pension transfers to MPs.

Reynolds, and the director of an unregulated introducer Celtic Wealth, Clive Howells, were called to give evidence before the Work and Pensions Committee in December. However, both Reynolds and Howells failed to attend.

Reynolds instead wrote to the committee claiming his firm has been the victim of a ‘barrage of innuendo, twisting and downright lies'. Reynolds said his firm offered both a contingent and flat fee charging structure and has advised around 100 BSPS members out of 300 who had approached the firm for advice. 

Committee chair Frank Field MP responded: 'Transferring out of a gold plated final salary pension is generally a terrible idea, except in very particular circumstances. Firms that are routinely advising people to take this route should be shut out of taking this type of business.'

There is no suggestion that Reynolds has any involvement in Fidelis Wealth Management.

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