FCA issues data request to Rolls-Royce DB pension transfer advisers

The Financial Conduct Authority (FCA) has issued a data request to a number of advisers involved in transfers from the Rolls-Royce PLC defined benefit (DB) pension scheme, after being alerted to concerns by Rolls-Royce.

The request was announced alongside a joint statement from the FCA, Money and Pensions Service (Maps) and The Pensions Regulator (TPR) emphasising the regulatory bodies' positioning on pension transfer advice.

The regulators confirmed that they have been engaging with both Rolls-Royce and the scheme’s trustees in order to be vigilant against the risks associated with increased transfer requests as a consequence of recent redundancies.

In particular, the regulators emphasised that all advisers should be clear on the FCA’s expectations when offering advice to members of the scheme, stressing where there is “unsuitable advice or bad practice”, the FCA will take action.

The statement continued: “The FCA, TPR and Maps believe transferring out of a DB pension scheme is unlikely to be in the best interests of most consumers.

“Any scheme members looking for impartial guidance, or thinking of transferring out, should contact The Pensions Advisory Service, part of Maps, before taking any further action.

A Rolls-Royce PLC spokesperson confirmed that the company had "proactively alerted" the FCA that the restructuring was attracting attention from the various financial advisers targeting colleagues, and has been keeping the regulators updated on the number of transfer requests received by trustees.

They continued: “We strongly support the action of the FCA in requesting information from financial advisers who have engaged with our employees and former employees to consider transfers out of the Rolls-Royce UK Pension Fund, and we urge the regulatory authorities to take action where any adviser is found to have been providing unsuitable advice to our people.

"Our DB pension scheme is – and remains – well funded. The unprecedented impact of the Covid-19 pandemic on the whole aerospace industry, however, has forced us to restructure our business and this is resulting in a significant number of job losses in the UK."

"Although we are prohibited from making recommendations to our employees or former employees about the most appropriate way to access their pension benefits to suit their personal circumstances, we do provide all of our retiring employees with access to free financial advice delivered by a regulated adviser selected in partnership with the trustee of our pension scheme, and supported by our trade unions.

"However, individuals are allowed by law to take advice from any adviser approved by the FCA.”

The spokesperson also confirmed that whilst WPS Advisory was appointed a preferred provider by the company and trustee in 2016, the current concerns were not associated with this firm, but rather were based on member feedback that other advisory firms were cold calling members.

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