The Financial Conduct Authority (FCA) could be looking at as many as 100 firms in its review of defined benefit (DB) pension transfer advice, according to the regulator's former technical specialist.
It has recently emerged that the FCA is looking at how advice firms provide DB transfer advice. New Model Adviser® has revealed how this has led to a number of firms suspending pension transfer advice.
Speaking at the Great Pension Transfer debate in Peterborough, Rory Percival (pictured), who is now an independent consultant, said he expected the regulator's work to include 'a significant number of firms' conducting DB transfer advice.
'They are doing multi-firm work...and I estimate they are looking at between 50 and 100 firms which I estimate is a significant amount. I think they are doing a first stage where they are calling on firms to send them in files on DB transfer advice,' he said.
'If they have concerns from the files they have seen or maybe they are particularly large players in the DB transfer market then they are going to see those firms.'
Percival said there are various forms of action for the FCA to take if it finds a problem with advice firms. He specifically mentioned that in 2016 the regulator asked 16 firms to vary permissions to restrict permissions on DB transfers. This was first revealed by a Freedom of Information request submitted by New Model Adviser®.
According to Percival, the FCA's work on DB transfer advice was 'similar' to a thematic review but did not meet the full definition of such a review. These reviews are used to assess 'a current or emerging risk' in a particular area or product, according to the FCA's website.
Percival added that he expected the regulator to publish the findings of its work on DB transfer advice to set out what action it has taken across the market.