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Mis-Sold Pensions

This is one of the few claim types where professional help may be worthwhile for complex cases.

#At a Glance
Difficulty ⭐⭐⭐ Complex
Time to DIY 4–6 hours
Potential Payout Up to £85,000+
Time Limit 6 years (or 3 years from awareness)
Escalation Financial Ombudsman / FSCS

#What Is It?

Financial advisers have a duty to give you suitable advice. If they recommended a pension transfer, SIPP investment, or pension product that wasn't right for you, causing you financial loss, you may have been mis-sold.

Common types of pension mis-selling:

  • SIPP transfers into high-risk or unregulated investments
  • Defined benefit (DB) transfers – leaving a secure final salary pension
  • Pension liberation – accessing pension early with huge fees
  • Unsuitable products – wrong pension type for your circumstances

#Am I Eligible?

#✅ You may have a claim if:

  • You received financial advice about your pension
  • The advice was unsuitable for your circumstances
  • You suffered financial loss as a result
  • You're within the time limits (6 years, or 3 years from awareness)

#Warning Signs You Were Mis-Sold:

  • ❌ Risks weren't properly explained
  • ❌ Promised unrealistic returns (8%+ "guaranteed")
  • ❌ Pressured into quick decisions
  • ❌ High fees weren't disclosed
  • ❌ Lost guaranteed benefits (e.g., left a final salary scheme)
  • ❌ Invested in unregulated products (overseas property, carbon credits, storage units, car parks)
  • ❌ Adviser earned high commission they didn't disclose
  • ❌ Pension transferred to a SIPP you didn't understand
  • ❌ Cold-called about your pension

#How Much Could I Get?

Route Maximum
Direct from adviser firm Full losses (if firm still trading and solvent)
Financial Ombudsman £430,000 (for complaints about events after 1 April 2019)
FSCS £85,000 (if adviser firm has failed)

Your compensation = The position you'd be in if you hadn't received the bad advice, minus where you are now.

#Types of Mis-Selling Explained

#SIPP Transfers

You were advised to transfer an existing pension into a Self-Invested Personal Pension (SIPP) and then invest in high-risk or unregulated products. Many people lost their entire pension this way.

#Defined Benefit Transfers

You were advised to leave a "final salary" or "career average" pension scheme. These schemes provide guaranteed income for life – giving that up is almost never suitable. The FCA found 47% of DB transfers it reviewed were unsuitable.

#Pension Liberation / Early Access

Firms promised you could access your pension before age 55. This is almost always a scam or tax avoidance scheme that results in 55%+ tax charges and fees.

#British Steel Pension Scheme

If you were a member of BSPS and transferred out following advice, there's a specific redress scheme – see the FCA website for details.

#Step-by-Step Process

#Step 1: Gather Information

  • Name of the adviser/firm who advised you
  • Date of advice and what was recommended
  • Any documentation (suitability report, fact find, transfer paperwork)
  • Evidence of your loss

#Step 2: Check If the Firm Still Exists

  • Search the FCA Register (register.fca.org.uk)
  • If the firm is still authorised, complain to them directly
  • If the firm has been dissolved/entered administration, go straight to FSCS

#Step 3: Submit Your Complaint

If firm is trading: Write to them explaining:

  • What advice you received and when
  • Why you believe it was unsuitable
  • What losses you've suffered
  • What redress you're seeking

If firm has failed: Apply directly to FSCS (fscs.org.uk)

#Step 4: Escalate If Needed

  • If the firm rejects your complaint or takes too long (8 weeks), escalate to the Financial Ombudsman
  • FOS is free and regularly awards significant compensation

#Evidence You'll Need

  • Suitability report from the adviser
  • Fact find document (your financial circumstances at the time)
  • Transfer paperwork
  • Statements showing current pension value vs projected value
  • Any marketing materials or correspondence
  • Notes from meetings (if you have them)

Lost your documents? The firm must have kept records. Ask them for copies or submit a Subject Access Request.

#FSCS Claims (If Adviser Firm Has Failed)

The Financial Services Compensation Scheme protects you when authorised firms fail.

  • Maximum payout: £85,000 per person, per firm
  • Process: Apply online at fscs.org.uk
  • Timeline: Typically 6–12 months, but complex cases take longer
  • Free: No fee to claim through FSCS

#When You Might Want Professional Help

Unlike most claims in this guide, pension mis-selling can be complex enough to warrant professional help if:

  • ⚠️ Your potential claim is very high value (£50k+) and you want expert calculation
  • ⚠️ The advice chain is complicated (multiple firms involved)
  • ⚠️ You've already been rejected and need strategic appeal
  • ⚠️ The case involves technical actuarial calculations

However: Always try FOS/FSCS first. They're free, independent, and handle these cases daily. You can always get professional help later if needed.

If you do use a CMC or solicitor for pension claims, expect fees of 15-25% of compensation.

#Common Questions

Q: The adviser seemed legitimate – how could they mis-sell?

Many advisers were properly authorised but still gave unsuitable advice. Legitimacy doesn't mean the advice was right for you.

Q: I signed paperwork agreeing to the transfer – does that matter?

No. Advisers can't contract out of their duty to give suitable advice. Signing paperwork doesn't prevent a claim.

Q: It was years ago – is it too late?

The time limit is 6 years from the advice, OR 3 years from when you first became aware (or should have become aware) there was a problem. Many people only realise years later.

Q: I transferred out of a final salary scheme and it's gone well – should I still check?

The advice could still have been unsuitable even if the outcome happened to be okay. If you were advised without proper assessment of your needs, you may still have a complaint.