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FSCS Accepting Claims for Abbey Lane BSPS Clients

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The independent financial adviser was put on notice by the Financial Conduct Authority in 2023 after providing unsolicited settlement offers to BSPS clients before the commencement of the redress scheme.

Defined Benefit Pension Transfers

An independent financial adviser (IFA) firm, Abbey Lane Financial Associates Limited (Abbey Lane), has been declared in default by the Financial Services Compensation Scheme (FSCS), which is now accepting claims against the firm.

The British Steel Pension Scheme (BSPS) scandal occurred after member steelworkers were instructed to make a decision about their pension pot as part of a restructure of the defined benefit pension scheme. Members were given the choice of three options:

  1. Remain with the original scheme and likely receive a reduced pension from the Pension Protection Fund.
  2. Move to a new scheme (BSPS2) sponsored by Tata Steel UK, which would provide lower future increases.
  3. Choose neither and transfer out of the scheme entirely.

Of the 130,000 members, a total of 7,834 chose the last option and transferred out of the BSPS scheme entirely, most (95%) with the advice of an independent financial adviser. It was subsequently found that nearly half of the members who transferred out of the BSPS were given unsuitable financial advice, and a redress scheme was launched in March 2023.

Abbey Lane Financial Associates Limited was a Sheffield-based IFA firm which claimed to offer “unbiased financial advice” on products including pensions, investments, insurance, tax, savings, long-term care, and mortgages.

Abbey Lane stopped trading in March 2023 and entered voluntary liquidation in the same month, shortly after it had been found to have offered unsolicited and ‘misleading’ settlement offers of £100 to 83% of its BSPS clients ahead of the introduction of the redress scheme.

In February 2023, the Financial Conduct Authority (FCA) – responsible for regulating financial services providers in the UK – issued the firm with a supervisory notice, a communication in which regulated firms are informed of action the authority is preparing to take.

In the notice, the FCA outlined that it was concerned that if former members had accepted the unsolicited £100 settlement offers, they may be excluded from the redress scheme and that the tactic was “deliberate to exclude former BSPS members from the redress scheme”. It also went on to outline that the offer’s value was “significantly misaligned with the average calculated redress of £45,000”.

The firm was subsequently instructed to:

  • Withdraw any existing settlement offers currently pending any consumer agreement
  • Treat any pending settlement offers as withdrawn
  • Cease making any further offers to former BSPS members who have not made complaints

In March 2024, the Financial Services Compensation Scheme (FSCS), a government-backed lifeboat scheme which protects customers of failed firms, declared Abbey Lane Financial Associates Limited as ‘in default’. This happens when the FSCS has “received at least one claim; and is satisfied that the firm is unable to return money to eligible customers itself. FSCS is required to do this before it can pay compensation to eligible customers.”

When an investment provider or regulated IFA goes out of business and cannot pay any claims against it, the FSCS can pay compensation of up to £85,000. So far, the FSCS has received 44 claims relating to unsuitable BSPS transfer advice; one has been rejected, one upheld, and the remaining 42 are still being processed.

FSCS claims can be complex, technically challenging, and time-consuming. TLW Solicitors have the experience and expertise required to present cases to the FSCS, ensuring claims are processed as quickly as possible, with the best results achievable for our clients.

Acting on a no-win, no-fee basis, we will assess your case free of charge and let you know the best way to proceed.

Sarah Spruce, Legal Director and Head of the Pensions Claims team commented:

“We’re glad to hear that the FSCS is finally accepting claims against Abbey Lane after what will have been an unsettling time for former BSPS members who used the firm for financial advice for their pensions, especially if they received and considered the initial settlement offer. My team has significant experience handling FSCS claims on a no-win, no-fee basis, so if you or a loved one has been affected, you should get in touch today and we can go through your options.”

If you are concerned about your, a friend’s, or a loved one’s investment with Abbey Lane Financial Associates Limited, please contact TLW Solicitors.

Call us on 0800 169 5925, email us, or complete one of the forms below.

It is important to get advice as soon as possible as strict time limits can apply.

Minimum case values apply.

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