The Financial Conduct Authority (FCA) has provisionally struck off the director of a financial services business after he was found to have “recklessly” provided pension transfer advice he was unqualified to give.
The FCA has banned Daniel Thomas from working in financial services and fined him £742,700 after it found he “repeatedly misled clients and pension providers about his professional qualifications, destroyed client records and failed to co-operate” with the FCA. The penalty imposed reflects the seriousness of the misconduct, the FCA said, and includes “an uplift for failing to cooperate with the FCA’s investigation”.
Rather than accepting the FCA’s ban, Thomas has referred the decision notice to the Upper Tribunal.
Thomas, a director and financial adviser at DPT Financial Solutions Limited, advised 53 clients about 63 transfers out of defined benefit pension schemes and is believed to have earned more than £173,000 in fees.
Thomas’s firm was an appointed representative, with Quilter Financial Services Ltd the principal firm responsible for overseeing its actions. The FCA found that Thomas provided misleading information to Quilter about his involvement in the pension transfer cases and made no findings against the principal firm in connection with the matter.
Only advisers with specialist qualifications and the correct permissions can advise people on whether to transfer out of their pensions, as this is not usually in the best interest of the client. Some of Mr Thomas’s clients were members of the British Steel Pension Scheme and were in a particularly vulnerable position when he was advising them, the FCA said.
The FCA has previously taken enforcement action against a wide range of firms and individuals for misconduct involving advice given to consumers to transfer out of the British Steel Pension Scheme.
In addition to a fining him £173,000 (plus interest), the penalty imposed includes an amount to reflect the seriousness of the misconduct, which is based on a percentage of Mr Thomas’ relevant income from DPT Financial Solutions Limited during the period connected to the breach. It also includes an uplift for failing to cooperate with the FCA’s investigation. The full calculation is set out at paragraph 6 of the Decision Notice.
Therese Chambers, executive director of enforcement and market oversight at the FCA, said: “When you advise someone on their pension, you hold their future in your hands. Mr Thomas recklessly betrayed that responsibility.
“We will not stop acting against those ignoring our rules and unfairly putting people and their hard-earned money at risk.”
The FCA will take no action against Thomas until the Upper Tribunal reaches its decision on his appeal.
