FCA uses emergency powers to stop British Steel Pension scandal advisers selling assets
The UK’s financial watchdog is using emergency powers to stop the firms who advised British Steel Pension Scheme (BSPS) victims from selling off assets to avoid paying compensation.
The Financial Conduct Authority (FCA) has launched the emergency asset restriction rules without consultation, in a bid to stop firms from wiggling out of victims’ hard-won redress.
Firms will have to abide by the rules, which will be introduced on Wednesday, until they confirm that they have sufficient resources to pay their potential compensation bill.
Members of the troubled BSPS scheme were told they were entitled to over £71m in financial compensation, at the end of last month, after years of campaigning.
The FCS, which launched a probe for a redress scheme in late December, has found that almost half (46%) of the advice given to members of the scheme was unsuitable.
The 2017 scandal involved 7,700 BSPS members receiving advice to take their funds out of the pensions scheme – which they took and lost “significant sums of money as a result,” the NAO said in a statement at the time.
Those who may have been impacted, after taking advice from an insolvent business or one which no longer exits, can submit a claim to the FCA for compensation. Workers are expected to be receiving redress by late 2023, the watchdog noted.
It follows the National Audit Office (NAO) launching a probe into the FCA’s handling of the British Steel transfer debacle in October last year. The audit watchdog said that it aimed to publish its findings in Spring this year.
The NAO’s investigation plans to support steelworkers who may be entitled to financial redress and work out how much compensation they could receive – an outcome which, today, has pulled through.
MPs had accused the FCA at the beginning of the last year of being “unfit for purpose” over its inability to help wronged consumers in the wake of the scandal.