S & M Hughes Ltd, trading as Crescent Financial
Failed 14 August 2020
You might be eligible for compensation
In September 2019, S & M Hughes Ltd (trading as Crescent Financial) was placed into liquidation. As part of our on-going monitoring of failed financial firms, we identified that the firm may have provided advice that left people worse off.
During 2017, many British Steel workers were advised to transfer out of their defined benefit pension into a defined contribution pension, known as a Personal Pension Plan or a Self-Invested Personal Pension (SIPP).
It was one of three choices available to British Steel Pensions Scheme (BSPS) members. The others were the new scheme (BSPS2) and Pension Protection Fund (PPF). You can read more about how these options compare in the Work and Pensions Select Committee inquiry report.
We have already paid £2.4 million to customers who had been advised to transfer out of the British Steel Pension Scheme. We found that the returns needed by the former BSPS members’ new pensions were unrealistic to match the benefits offered by the BSPS2 or the PPF, and that customers would have been better off if they had not transferred to a private plan.
Even if those that transferred haven’t lost money yet - the terms, exclusions and complexities involved in a DB transfer (where they were advised to transfer out of their defined benefit pension with the BSPS and into a defined contribution pension) may not have been adequately explained.
By transferring to a private pension arrangement, they would have lost the benefits you already built up in the BSPS. It may not be realistic to achieve the same level of benefits from their new plan.
The advice they received may not have been the best advice for them.
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