The Financial Conduct Authority (FCA) has fined Inspirational Financial Management Ltd (IFM) £897,840。

The IFM has advised people to move out of defined benefit (DB) pension schemes, including the UK Steel Pension Scheme (BSPS).。

Arthur Cobill, an adviser to IFM, and William Hofstetter, one of its directors, have been banned by the FCA from advising clients on pension transfers and pension exits, and Hofstetter is also barred from holding any senior management positions at any regulated company.。

Cobill and Hofstetter agreed to pay £120,000 and £40,000 respectively to the Financial Services Compensation Scheme (FSCS) to compensate IFM customers.。

Between 8 June 2015 and 22 December 2017, IFM provided inappropriate pension transfer advice, failing to give due consideration to whether it was in the client's best interest to move out of a secure DB pension.。The company uses a contingent fee model, which is only charged when customers transfer out of their DB pension plan based on company recommendations.。

While this approach benefits IFM, Hofstetter and Cobill, it jeopardizes the long-term financial health and interests of customers。The FCA's review found that 83 per cent of IFM's pension transfer proposals did not meet its minimum required standards and that customers were at risk of financial loss as a result of poor advice received.。

Of 307 IFM clients advised to transfer out of DB pension plans, 261 completed the transfer-out process。Cobill advised 245 of them, including 198 BSPS members.。Total value of pension benefits for BSPS members proposed by Cobill exceeds £90m。

Hofstetter is responsible for compliance oversight of IFM's pension transfer consultation process。

Clients moving out of BSPS are already in a weak position due to uncertainty over the future of their pension plans, so it is vital that they receive good advice。