1. Which adviser?
The internet is full of financial advisers offering transfer advice to those that have UK pension schemes. Many advisers claim to be QROPS or UK Pension Transfer Specialists.
2. The right expertise
How can the public work out which advisers have a suitable level of expertise if all the advisers claim to be experts? There are some advisers that have no pension qualifications or they may have qualifications but no relevant experience in dealing with UK pensions.
3. The right qualifications
While a knowledge of non-UK jurisdictions and foreign tax rules is essential, the starting point for any advice is a proper understanding of the UK pension and Double Tax Treaty.
a. The FCA ( Financial Conduct Authority ) in the UK insists on the following pensions’ qualifications for all UK advisers that deal with pension transfers. Non-UK clients should expect the same:
• G60 or AF3 – ( Chartered Insurance Institute )
• Fellow/Associate of the Faculty of Actuaries
• Pensions paper of Professional Investment Certificate (IFS)
• Fellow/Associate of the Pensions Management Institute
The public should check that an adviser has one of the above qualifications and, if not, ask to be referred to such an adviser. We believe that the qualification is only the starting point; relevant experience and correct regulation is as important.
b. Will the adviser be prepared to offer the clients a choice of a time based fee or commission? Bear in mind that commission is only payable once an investment is made and sometimes the most appropriate advice may be to leave the UK pension where it is. Commission leads to bias in other words.
c. Is the adviser currently a member, by qualification, of a professional institute and signed up to the institute’s code of conduct and commitment to continued professional development?
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d. References from clients may be fine to an extent, but often problems appear later on. Take references from professional independent referees and previous employers ideally, and if in doubt contact a regulated IFA in the UK who can perform additional checks that you may not be able to (there may be a fee involved but it is better than a penalty later on!)
e. What experience does the adviser have? Due to the complexity of pension transfers, it should be expected that the adviser has several years’ experience or, if not, that the firm that supervises the advice has appropriately experienced staff in place.
A large number of advisers that claim to be experts have no relevant UK pension qualifications, have no relevant working experience with UK pensions and often have no qualifications at all. Some advisers make unfounded claims about their qualifications, use titles that they are not permitted to use and falsify their pasts and experience.
a. Corporate membership of an institute such as The Chartered Insurance Institute (CII) or The Chartered Institute for Securities and Investments (CISI) does not refer to a qualification. Some firms proudly display this membership, but it does not guarantee that the advisers are all qualified.
b. Titles such as FPC or CISI do not exist. The CII provide the public with a link to check on the membership status of the CII advisers. The CII have stated that the use of titles, without permission, is actionable. The public would need to contact the CISI to check membership. Please note, the CISI do not offer pension qualifications.
Qualified means the following; CertPFS, DipPFS, APFS/FPFS – all members signed up to a code of ethics to treat customers fairly and a commitment to continous professional development.
Ordinary/Student only membership is open to members of the public, there are no exam requirements for membership. CII ( Award)/FAIQ are basic introductory qualifications and are not subject to the requirements of qualified members.
The public need to check the education and experience of the adviser before engaging. There is a considerable amount of misinformation that leaves the public open to poor advice. Regulation and local knowledge also needs to be checked, in addition to the UK pensions’ qualifications and experience ( please check this on the relevant tabs on this website).
The views expressed in this article are not to be construed as personal advice. You should contact a qualified and ideally regulated adviser in order to obtain up to date personal advice with regard to your own personal circumstances. If you do not then you are acting under your own authority and deemed “execution only”. The author does not except any liability for people acting without personalised advice, who base a decision on views expressed in this generic article. Where this article is dated then it is based on legislation as of the date. Legislation changes but articles are rarely updated, although sometimes a new article is written; so, please check for later articles or changes in legislation on official government websites, as this article should not be relied on in isolation.
- Qualified Adviser for QROPS
- Chartered Insurance Institute
- Offshore Adviser Qualifications
- How offshore advisers use regulatory wording to deceive you!
- Chartered Financial Planners logos | TailorMade Pensions
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