The press release issued by HM Treasury on 7 July 1998.
Independent Financial Advisers (IFAs) were today blasted by the Economic Secretary Helen Liddell for their lack of progress in sorting out personal pensions misselling.
The Minister called in 30 senior representatives of IFAs and IFA networks and told them she was very concerned about the slow progress in the sector. IFAs were seriously lagging behind the major pension firms who had made big strides in sorting out their pensions cases.
Mrs Liddell said:
“Enough is enough. My patience is exhausted by the lack of progress of IFAs. I am amazed at the attitude of firms who seem to think their inaction is defensible, and when faced with phase 2 of the review choose to blame everyone except themselves.
“People have lost out as a result of having been sold products, which were wrong for them. IFAs have a clear responsibility to sort out whether any of their customers deserve compensation and provide it where it is warranted Where there was misselling, those who took the profit should now face the pain.”
The meeting followed on from an announcement yesterday by the Personal Investment Authority (PIA) that 41 IFAs were being disciplined for failings connected with the pensions review. The Minister said:
“I hope this action by the PIA makes it absolutely clear to all IFAs that discipline is a real prospect if they fail to deal with their cases. The review must be tackled with professional diligence and businesslike rigour. Nothing less will do. We are talking about people’s life savings and their future welfare.”
The Minister called into question the future of the IFA sector and said she would be keeping a careful eye on IFAs’ progress over the next few months and said if actions was warranted it would be taken. She said:
“In the long term, if the IFA sector fails to put its house in order, and genuinely command the trust of customers, it will not only call into question the viability, but possibly the desirability, of the current industry structure.”
Mrs Liddell advised the public to be very careful when using an IFA. She said:
“In my opinion anyone thinking of taking advice should check out the IFA thoroughly. Check their attitude to the consumer protection that regulation provides, and to putting right past problems – including their progress with the pensions review. Ask if they have ever been fined or disciplined by the regulators.”