FCA starts High Court action over DB transfer advice failings

Jenna Brown reports

The Financial Conduct Authority (FCA) has started High Court proceedings against Paul Steel and Jacqueline Foster, directors of a failed advice firm, over alleged unsuitable defined benefit (DB) transfers.

The pair were directors of Estate Matters Financial (EMF), which is in liquidation. The FCA said as part of the proceedings, an interim injunction has been secured which freezes the assets of Steel and his partner, Foster, up to the value of £7m pending a further hearing.

The FCA alleges that EMF has contravened various requirements under the Financial Services and Markets Act 2000 by providing “unsuitable” DB pension transfer advice, leading consumers to exit final salary pension schemes when it “was not in their best interests to do so”.

Steel, who was EMF’s director and co-owner, was “knowingly concerned in those contraventions,” the regulator claimed.

It will also be alleged that Steel breached FCA requirements by undertaking a “course of conduct which resulted in the removal of EMF’s assets, leaving it unable to meet potential liabilities for unsuitable advice, whilst enabling Steel to retain the significant profits that accrued from the provision of that advice, and from ongoing fees”.

An injunction was obtained against Foster on the basis that she may be holding or controlling assets owned by Steel, according to a statement from the regulator.

The FCA is asking the High Court to make a restitution order requiring Steel to compensate consumers who have suffered losses as a result of receiving unsuitable pension transfer advice. No trial date has been set.

Estate Matters Financial is a liquidated company incorporated on 6 August 2007 with the registered office located in Birmingham according to Companies House.