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Pembrokeshire Mortgage Centre fined £2.3m for ‘woeful pensions advice’

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THE FINANCIAL CONDUCT AUTHORITY (FCA) has fined Pembrokeshire Mortgage Centre Limited, which was based in Saundersfoot, £2,354,331 for unsuitable advice to consumers to transfer out of the British Steel Pension Scheme (BSPS) and other defined benefit pension schemes.

The FCA’s view is that most people should keep the guaranteed income provided by a DB pension.

Pembrokeshire Mortgage Centre advised 420 consumers, nearly two-thirds of whom were BSPS members, on whether to transfer out of their defined benefit scheme – 93% were advised to transfer, and as a resulting PMC earned over £2m in transfer and ongoing advice fees.

Mark Steward, executive director of enforcement and market oversight, said: “Pembrokeshire Mortgage Centre advised hundreds of consumers to give up valuable defined benefit pensions without any adequate justification or rationale, using generic, templated advice not tailored to the specific circumstances of their customers while earning fees in doing so.

“The quality of advice seen here was woeful.”

As of 30 November 2022, the Financial Services Compensation Scheme (FSCS) has upheld 213 pension transfer claims against Pembrokeshire Mortgage Centre and paid out more than £13.3m in compensation.

Many of the people advised were in a vulnerable position due to the uncertainty surrounding the future of the British Steel Pension Scheme and the short timescale they had to make a decision.

But the regulator found that 60% of people did not receive the quality of advice they needed to make an informed decision.

However, the FCA said they did not receive the quality of advice they needed to make an informed decision.

The regulator said they needed clear, objective and expert advice. Instead, Pembrokeshire Mortgage Centre gave unsuitable advice in 60% of cases, even higher than BSPS as a whole.

The failings included the provision of generic suitability reports that were not tailored to the circumstances of individual consumers and contained contradictory, misleading and confusing statements.

The FCA said Pembrokeshire Mortgage Centre also failed to have adequate resources to deal with the increase in cases caused by BSPS, further impacting the quality of advice provided.

Many consumers, according to the regulator, were advised to transfer out even though they were relying on the guaranteed income to fund their retirement and could not afford to bear the risk of transferring out.

This included those who needed the money to provide for dependents needing long-term care.

Steward added: “The failings were particularly egregious in the context of the British Steel Pension Scheme, where customers were in an unusually vulnerable position.

“The FCA’s investigation into the involvement of others in these matters remains ongoing.

“Any consumers who were advised to transfer should contact the Financial Services Compensation Scheme to see if they are owed redress.”

Pembrokeshire Mortgage Centre Limited is currently in liquidation, The Pembrokeshire Herald understands.

The said that it would FCA will give preference to creditors (some of whom may be consumers), ahead of its financial penalty, to maximise funds available for redress – meaning it is unlikely that the fine would ever be paid.

The FCA has said that it continues to progress around 30 ongoing enforcement investigations into firms and individuals relating wholly or partly to BSPS advice, all of which are at a very advanced stage, and some are in litigation.

A former director

Business

Welsh Freeport competition heats up with Senedd vote

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ON WEDNESDAY, the Senedd will hold a debate regarding freeports as the competition for UK and Welsh Government funding nears its conclusion.

Currently, three bids are in from across Wales for a chance to benefit from £26 million of direct UK Government funding, as well as reduced taxes for businesses in the freeport area. A Welsh freeport could see up to 16,000 jobs created and further investment or the local area into the billions.

Speaking ahead of the debate, Welsh Conservative Shadow Minister for the Economy, Paul Davies MS said:

“Benefits of a freeport cannot be understated, bringing much needed jobs and investment into some of the most deprived areas of Wales.

“The UK Government put the challenge to Wales to submit exceptional bids, and Wales has delivered.

“All three bids would help to transform their local communities in different ways. It’s essential that the UK and Welsh Governments work together to deliver that second freeport for Wales, maximising the opportunities that these bids have to offer.”

The three Welsh Freeport bids are:

  • The Celtic Freeport (covering Pembrokeshire to Neath) which has estimated that it would create over 16,000 new jobs and up to £5.5 billion in new investment.
  • The Anglesey Freeport would support up to a £1 billion contribution to UK GDP by 2030, while also creating up to 13,000 new, high salary jobs in Ynys Môn.
  • The Newport Freeport (including Cardiff Airport) is aiming to increase non-passenger revenues to 50%, ending their reliance of passenger generated income.

The UK Government stated that “if a truly exceptional proposal were presented at the bidding stage” than a second freeport would be funded.

The Welsh Conservative debate reads:

To propose that the Senedd:

1. Recognises the opportunities for freeports to energise the Welsh economy, create high quality jobs, promote regeneration and investment.

2. Notes that three bids from Wales have been submitted for consideration by the UK and Welsh Governments.

3. Calls on the Welsh Government to work with the UK Government to deliver two freeports in Wales, recognising the truly exceptional proposals submitted and the transformational benefits they can deliver for the Welsh economy.

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Business

Site visit for National Park planners considering caravan park improvements

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NATIONAL PARK planners, expected to allow officers to approve an application to relocate caravans in a caravan park, will instead attend a site visit there.

Huw Pendleton, of Celtic Holiday Parks, had applied for a change of use of land for the siting of nine relocated static caravans and associated infrastructure improvements at Meadow House Holiday Park, Summerhill.

The application, before the February meeting of Pembrokeshire Coast National Park’s Development Management Committee, had been recommended for delegated approval by officers if a string of conditions were met.

Delegated approval for the application at the 200-pitch site bordering the national park was mooted despite Amroth Community Council objecting to the application; recommending refusal.

A report for planners said 47 static pitches were previously permitted under a change from 55 touring pitches; nine of these static pitches now being proposed for relocation to an area of land within the holiday park.

It stated the overall number of pitches within the site is not proposed to be increased.

Correspondence had been received which raises concerns on the privacy impact from the proposed static caravans on existing residential properties, as well as the potential for noise and disturbance from occupiers of the site.

It was recommended for delegated approval with a string of conditions including the completion of a Section 106 agreement.

At the February 2 meeting, concerns were raised by neighbour Dorian Evans on amenity grounds, and by local county councillor Alec Cormack, who asked for deferment pending a site visit, saying there would be a “significant impact” on neighbouring properties, which was disputed by agent Gerald Blain.

Following a proposal by Councillor Simon Hancock, members agreed to attend a site visit.

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Business

Successful forum held in Pembrokeshire for local landlords

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A NEW scheme enabling local private sector landlords to lease their property to the County Council in return for a guaranteed monthly rental income (Leasing Scheme Wales) has been launched at a Pembrokeshire Landlords Forum.

Held at County Hall in Haverfordwest last week, the successful Forum was attended by more than a hundred landlords.

As well as the launch of Leasing Scheme Wales, the Forum included presentations on the new housing act Renting Homes (Wales) Act 2016, fire safety in the private rented sector and eight key points for landlords.

The speakers were Fiona Brown, Private Rented Sector Liaison Officer for Pembrokeshire County Council, Gillian Owens from the National Residential Landlords Association, Stuart Macdonald from Mid and West Wales Fire and Rescue Service, and Julian Ings from Rent Smart Wales.

Cabinet Member for Housing Operations and Regulatory Services, Cllr Michelle Bateman, said it has been a very worthwhile evening.

“We were so pleased to see the level of attendance from landlords in Pembrokeshire,” she said. “There was a lot of interest in the presentations, particularly in the new renting homes act, plenty of questions and good feedback.”

Organised by the County Council’s housing team, the Forum will be a regular fixture with another one planned for the summer – date to be confirmed.

Cllr Bateman said they were also very pleased with the interest shown in Leasing Scheme Wales (LSW). The scheme enables local private sector landlords to lease their property to Pembrokeshire County Council for between five and 20 years, in return for a guaranteed monthly rental income and full property management service. LSW is funded by Welsh Government and managed by Pembrokeshire County Council.

“This scheme will help more Pembrokeshire people to live independently in safe and affordable properties,” said Cllr Bateman.
“Landlords will not have to worry about the condition of their properties after a tenancy as we will be responsible for the maintenance of the property and will return it to the landlord in the same condition as it was before the tenancy started. We will also be responsible for all the void work – the work done on properties in between tenancies.”

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