The FCA has banned Richard Fenech and Heather Dunne from working in financial services and fined them £270,646 and £399,817 respectively.
The regulator found that the pair operated a ‘flawed advice model’ that put customers’ guaranteed pension benefits at ‘significant risk.’
It also said Dunne had failed to act with due skill, care and diligence when providing pension transfer advice.
Fenech was the sole director of Financial Solutions Midhurst Limited (FSML) and responsible for overseeing Dunne, who was FSML’s appointed representative.
In the regulator’s view, Dunne failed to take into account the destination of the customers’ investments when advising whether defined benefit pension transfers were suitable.
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This was due to the use of a flawed two-adviser advice model in which Dunne provided the pension transfer advice while another firm provided investment advice on the proposed onward investment after the transfer.
As a result, Dunne did not know where her clients’ money was going when advising on the transfer, leaving customers exposed to the risk of unsuitable pension transfers, the FCA added.
She advised approximately 92% of her clients to transfer out of their defined benefit (DB) pension schemes, resulting in over £126m of funds being transferred, often against her clients’ best interests, in the FCA’s view.
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Therese Chambers, joint executive director of enforcement and market oversight, said: “People must be able to trust the advice they receive about their pension. The actions of these individuals are wholly unacceptable, as they exposed customers to significant financial risk.
“Ms Dunne provided advice which was fundamentally flawed and Mr Fenech failed in his responsibilities to oversee her work.
“In doing so, both demonstrated a complete disregard for customers’ needs through retirement, and the suitability of pension transfers, so it is right we ban them from the industry.”
