Berkeley Jacobs unlocked pensions and a fine

Between December 2000 and March 2003, when Berkeley Jacobs Financial Services Limited concentrated exclusively on early vesting of pensions benefits, the firm’s business in the area was “fundamentally flawed and unfair to customers” according to the Final Notice issued on 11 February this year.The firm’s cartoon commercials on Sky television pushed the benefits of early cash release but failed to balance the message with warnings about reduced income in retirement and the fact that the option might not be appropriate for all investors. The policy was, the Notice remarks, “aggravated by a ‘production line’ approach to selling” and inadequate compliance controls that should have picked up the “serious breaches within Berkeley Jacobs’ advertising and sales processes.” The firm’s ‘Client Profile form’ left out pertinent questions such as how much income customers thought they would need in retirement; whether they held life policies that were not already assigned; and significant information about existing pension provision. The best value annuity option, that maximised income, was also not examined; nor was the impact on DWP/DSS benefits considered or possibly cheaper alternatives, such as loans and or re-mortgaging explored.