We wanted to make you aware of a couple of changes to processes that we have bought in due to changes in legislation:
- The Stronger Nudge
The Financial Conduct Authority (FCA) has finalised it’s rules regarding “The Stronger Nudge” which became effective from 01/06/2022. The rules require us to encourage a retail client to take pensions guidance if they have not be advised by a regulated financial adviser. The rules also apply when an application is received from the member directly, regardless of whether the member is advised or not.
The processes that this new legislation covers include when a member takes benefits from their plan, transfers in another plan to their SIPP in order to take benefits from it, transfers out from their SIPP or when a beneficiary elects to set up a pension plan.
We have updated our member benefits form, application forms and additional transfer form accordingly and these can be found on our website or can be obtained directly from your dedicated account manager.
- Transfers out
As you know new rules on transfers out came into force at the end of November 2021. The Pensions Regulator requires us to complete specific due diligence on the receiving arrangement and the investments within it before a transfer out can be finalised. The level of due diligence required depends on the type of receiving scheme.
Carrying out this due diligence may result in us having to call your client to ask questions about how funds in the receiving scheme will be invested eg in overseas investments, and the costs and charges of the new arrangement and investments. Unfortunately we have to make these enquiries directly with the client rather than through yourselves as we normally would. Depending on the answers your client gives we may also need to refer them to the Governments MoneyHelper for guidance before we can process their request to transfer.
As all providers have to carry out this due diligence it may impact the time taken for transfers in to us to be processed as well whilst the transferring schemes complete their due diligence.
We will endeavor to continue to process transfers smoothly and with as little disruption as possible and will copy you in on any correspondence that we send to your client with regard to the transfer.