The industry regulator, the Financial Services Authority has confirmed that it is looking into equity release and pension unlocking, expecting them to be the next mis-selling scandal. Clive Briault from the FSA spoke at the Labour conference last week and voiced concerns that the two areas being looked at were concerning, with "wholly inappropriate" marketing material being targeted at the over 50's and pensioners.
Mr Briault said, "we cannot predict where the next mis-selling scandal will come from but there are two areas that we are looking at very closely. The two biggest potential mis-selling scandals are the mis-selling of products designed to allow customers to release the value of their property in retirement and pension unlocking".
Our View
Whilst the equity release market will shortly be regulated by the Financial Services Authority, it is still a 'taboo' area that many think is inappropriate. We believe that equity release can be fantastic for the right people, but cause much heartache to those it is unsuitable for.
In terms of pension unlocking, this is happening everywhere and the FSA is right to crack down. Only recently we have seen marketing material being circulated in Spain, in an attempt to get expatriates to transfer their company pensions to other pensions and take the benefits out.
Without the right advice from a specially qualified adviser, people that transfer pensions and "unlock" the benefits could be losing out by thousands of pounds.
All advisers at have the specialist qualifications and would be happy to provide an opinion (or advice if you need it), if you have been approached to unlock your pensions.