Ombudsman ruling paves the way for final-salary pensions redress
Savers who have transferred out of generous final-salary pension schemes could be entitled to compensation from their financial advisers, even if the adviser explicitly warned them against it
Savers who have transferred out of generous defined-benefit (DB) pension schemes could be entitled to compensation from their financial advisers, even if the adviser explicitly warned them against it, following a ruling from the Financial Ombudsman Service.
The case concerned a saver who asked his adviser for help transferring valuable DB pension benefits into a defined contribution scheme so he could access a larger cash lump sum. The transfer only went ahead after the saver signed a disclaimer certifying he was making the switch against advice.
But the ombudsman has now ruled that the adviser did not do enough to understand why the person rejected the advice, and should have discussed their options in more detail. The case could pave the way for more claims from people who have regretted a DB transfer, potentially including the Port-Talbot steelworkers (pictured), many of whom agreed to a transfer.