Selectapension's SBS arm had planned to resume pension transfer business in 2018 after suspending DB pension transfers earlier this year following an FCA audit.
However, its partner firm which carried out the transfer analysis - CFP Management Limited (CFPML) - has agreed to cease pension transfers as of October this year following consultations with the FCA.
In an addition to CFPML’s permissions list on the FCA Register, CFPML now states: “Cease to advise on pension transfer. With effect from 31 October 2017, the firm shall cease to provide advice in relation to the transfer, or conversion, of safeguarded benefits under a pension scheme to flexible benefits.”
Andy McCabe, managing director of Selectapension, said: “We regret the inconvenience this has caused to our mutual clients and wish CFP Management Limited every success with their future endeavours”.
While Selectapension Bureau Service's pension transfer service is suspended for the time being, Selectapension has not ruled out re-entering the market. A spokesman said: “We are reviewing our proposition covering Defined Benefit transfer advice services, however it is too early to comment further at this stage. Selectapension will continue to offer transfer value analysis reports”.
SBS said last month that it had hoped to resume new pension transfer business next year and would begin to look at pipeline business next month.
In a statement at the time of the suspension, Selectapension said: “Our partner CFPML has made good progress to meet the FCA’s requirements, following their visit in June, and are well on track to complete this work by the end of October. They should therefore be in a position to process those cases which await recommendations from early November.”
“All advisers who have introduced cases have been contacted to establish whether they wish to continue with CFPML or to withdraw these, with no charge, and proceed with a new advice firm. We will prioritise the existing pipeline cases and are therefore unlikely to accept any new cases until the beginning of 2018.”
With the new pension freedoms in place, pension transfer business in the UK has boomed this year with an estimated 80,000 transfers going through the process and a predicted 100,000 cases next year.
Selectapension is a significant player in the DB transfer analysis market. Advice firms using the firm's DB TVAS system received analysis of 74,000 cases in the 12 months to August 2017, according to company figures.
The company apologised to advisers earlier this year after it suspended DB pension transfer business following an FCA audit.
At the time of the suspension, the company said that following an FCA review of its outsource partner CFPML it made some changes to its transfer process following advice from the FCA. Full permissions remained in place while CFPML worked with the regulator on its review.
Selectapension suspended its Selectapension Bureau Service, which handles DB transfers for advisers, so the partner firm could deal with the outstanding backlog from a booming market and to allow CFPML to update its processes.
The FCA has been undertaking greater scrutiny of the pension transfer market this year after a review found some advice may not have been suitable.
• Editor's note:
1.Story updated 1.27 pm, 06.11.17 to add additional comments from Selectapension regretting inconvenience and about potential resumption of the transfer service.
2. Story updated 4.50 pm, 06.11.17 to add Selectapension Bureau Services logo and clarify where Selectapension subsidiary SBS was the provider.