Pension playpen founding editor Henry Tapper said that the Financial Conduct Authority (FCA) has been caught out over contingent charging, and that the controversial charging strategy should be banned immediately.
Speaking to New Model Adviser® following the publication of two papers on defined benefit pension transfers, Tapper said that the FCA's u-turn on its decision to consider looking more favourably on defined benefit transfers showed it had been caught out.
Last year the regulator said it would look at a policy that would view DB transfers in a more favourable way. However yesterday it reversed that stance.
'I think they were caught out, and a lot of people were caught out too,' Tapper said.
He added that the regulator should waste no time in banning contingent charging to prevent further harm being done to DB policy holders. Yesterday the FCA launched a consultation on the possible effects of such a ban.
'It's not a question of if we ban contingent charging, it's when we ban contingent charging, and the answer is immediately.'
You can watch the full video above.