The FCA has banned Geoffrey Armin from advising on pension transfers and pension opt outs and from holding any senior management function in a regulated firm.
Armin has been told to pay £200,000 to the Financial Service Compensation Scheme to contribute to redress due to his customers, including members of the British Steel Pension Scheme.
To date, the FSCS has paid out £3,961,517 in compensation to Armin’s clients.
According to the FCA, while running Retirement and Pension Planning Services Limited, which has now been dissolved, Armin was “seriously incompetent” when advising on defined benefit pension transfers.
He advised 422 customers on the transfer of their DB pensions, including 183 members of the British Steel Pension Scheme.
Of these 183 people, 174 - or 95 per cent - transferred out of the scheme following his recommendation.
The total value of transfers on which Armin advised was £125mn, £74mn of which related to the British Steel Pension Scheme.
His firm receive fees which added up to £2.2m for all DB transfer advice, 55 per cent of which (approximately £1.2mn) was retained by RPPS and Armin.
The FCA said Armin routinely failed to obtain the necessary information he needed to assess the suitability of a pension transfer and provided unsuitable advice as a result.
According to the FCA, Armin "largely disregarded" information about customers which was necessary to assess whether it was suitable for them to transfer their pension, including information about their financial situation and their income needs throughout retirement.
In some cases, the FCA said Armin only informed customers of the consequences of giving up the guaranteed benefits offered by their DB pension after they had already transferred out of the scheme.
The FCA found Armin failed to find out about alternatives to transferring out of the British Steel Pension Scheme, including transferring into the new defined benefit pension scheme offered by the sponsoring employers or remaining in the existing
scheme and moving into the Pension Protection Fund.
Therese Chambers, joint executive director of enforcement and market oversight at the FCA said: "Mr Armin gave bad advice and pocketed large fees for doing so. People rely on the advice they’re given for financial security into old age.
“Mr Armin’s advice not only put at risk the pensions people had worked for, it also eroded the trust between advisers and clients. Such callous incompetence has no place in financial services."
Armin referred the FCA’s decision to take action to the Upper Tribunal and the hearing was due to commence on September 11, 2023.
But on September 6, 2023 he agreed to pay a substantial proportion of his assets to the FSCS as compensation and withdrew the referral.
amy.austin@ft.com
