Contact

News & Insights

Pension Transfers – the need for advice

This feedback comes at the same time that the regulator has expressed fears that the members of eight of the UK’s largest company pension schemes are targets for rogue financial advisers, prompting their intervention. The Financial Conduct Authority (FCA) and the Pensions Regulator have alerted the trustees of company pension plans, including Lloyds Banking Group and J Sainsbury, that unscrupulous advisers may try to persuade their members to transfer out. They acted after a surge in pension transfers, following freedoms announced in 2015, with the quarterly total hitting a record £10bn in the first quarter of 2018, according to official statistics. They fear that advisers are trying to prey on worries about the future of pension funds. The regulators warned the trustees at J Sainsbury and Asda after the two supermarket chains announced a merger in April.

Unfortunately, like in any industry, there will always be the good and the bad and that is no different in financial services. The fact that transfers exceeding £30,000 require specialist advice is a real positive as it should avoid inappropriate advice. At Blacktower, we always adopt a ‘four eyes’ principal whereby any advice given is checked not only internally, but always requires external advice in the case of transfers from defined benefit schemes. Pension transfer advice is very technical and we will only ever recommend a transfer if the benefits from the existing scheme can either be matched or improved on.

The real area of concern however remains for the smaller pension pots of less than £30,000 as there is no advice requirement. I was helping someone recently who had four separate periods of employment in the UK that attracted a pension entitlement. Whilst these four pension pots were individually less than £30,000, the total exceeded £100,000. As cited by the FCA, an unauthorised adviser could have recommended an inappropriate pension transfer leaving the individual worse off than had she kept the pensions where they were. Whether a transfer is £10,000 or £1m we follow the same strict rules to ensure that best advice is always given. Sadly, that is not always the case as evidenced above.

There are potentially thousands of expats living in Cyprus who have not yet drawn on their private or company pension plans. With annuity rates at rock bottom, there is often a very strong case to transfer your entitlement overseas. Every case, however, is different. I have had personal experience of helping a vast and varied number of individuals and no two situations have been the same. For that very reason, I urge anyone not yet retired to seek professional advice from a regulated and authorised firm so as to avoid the many sad cases of people suffering from unscrupulous ‘advisers’ elsewhere.

Other News

Tax and Benefits Across Borders – Don’t Get Caught Out

Calculator with Euro buttonLiving as an expat in Spain, or indeed in any other country, brings particular and sometimes very complex wealth management requirements because managing personal finances across multiple jurisdictions is inherently complex and invariably requires specialist advice.

This goes some way to explain why thousands of British expats have recently been caught and penalised for either failing to pay taxes or unlawfully claiming British pension and other social security benefits while living and, in some cases, working abroad.

Cross-border taxation for expats is a notoriously confusing area of wealth management and can seem especially onerous with new data sharing and enforcement rules in place. Unfortunately, not all asset managers are as familiar with tax reporting requirements as they should be. This may seem inconceivable, but wealth management professionals in Spain, across Europe and indeed the globe have an obligation to clients to ensure that they understand and follow all the rules.

Read More

Dealing with scams

Blacktower Financial Management

You may have seen emails alerting you to a new fraud specific to the financial services advice industry. We are not aware of any of our clients having been targeted in the way described below, but it is our responsibility at Blacktower to do everything we can to educate our clients about these scams to avoid any harm coming to them.

The fraudsters claim to be from the Financial Conduct Authority or local law enforcement and are targeting clients of investment management firms. They are advising clients that the investment manager, adviser or firm is under investigation. The fraudster specifically asks the client not to speak to their investment manager, adviser or firm, or even close connections, claiming this would be considered tipping off. The client is then advised to encash their portfolio and move the cash to the client’s bank account. Once this is done, the fraudster then ‘recommends’ an investment which is actually a scam.

Read More

Select your country

Please select your country of residence so we can provide you with the most relevant information:

You are currently viewing the Blacktower Financial Management EU website.

You may be looking for the Blacktower United Kingdom website.

Blacktower United Kingdom > X Stay on this site

Or choose your country.