With a growing demand for DB transfer values, the on going the on-going burden of DB liabilities on employers and now the FCA widening its probe into firms offering DB transfer advice, it is more important than ever that employers and trustees consider how they can help employees to find suitable advice.

It is a requirement that transfers for DB pensions above £30,000 the individual member must take advice, but how do they find an adviser and what help can/ should employers give them?

DB transfers are one of the highest risk areas of advice for both the individual pension member and the financial advice firm.  

For the member, this may be a lifetime of accrued pension benefit and the mainstay for providing their financial security in retirement. For an adviser, this is a very specific area of advice; it requires pension transfer specialists, who are experienced practitioners in this area and a very robust, clearly priced and clearly documented service. 

When reviewing DB transfers the values may be very large - 6 or even 7 digits - so it is easy to see why there is plenty of interest from both scammers and advice firms.

But what can employers and trustees do to help direct individual members away from scammers and to firms who can provide a suitable service?

  • Start by telling them they may be at risk of scamming and send them to the Pension Advisory Service website for some helpful ways to identify and steer clear of scammers https://www.pensionwise.gov.uk/en/scams
  • Communicate that for many people, DB transfers are unlikely to be suitable. If they do not have any other sources of retirement income besides their DB pension, if they do not expect to have a shortened life expectancy due to known health conditions or, if in considering the transfer they will be looking to try to replicate the DB pension they are giving up then a DB pension transfer is not likely to be for them. The Money Advice Service has some information that can help https://www.moneyadviceservice.org.uk/en/articles/transferring-out-of-a-defined-benefit-pension-scheme#at-a-glance
  • Arrange a seminar/ webinar to educate those who may be considering this to help their understanding of the benefits and risks and to enable them to ask questions
  • Consider selecting a panel of advice firms on which your firm has carried out due diligence on and that meet your own standards of integrity.  Without making a recommendation, let members know this panel has been selected and the basis on which it was selected. This may help them understand the service aspects and criteria that are important to look for in a suitable DB transfer partner
  • Provide members with a 'Helpful tips' sheet on what to look for in a good DB transfer adviser. This could include checking the FCA register, only looking for advisers that are regulated to provide transfer advice, checking social media and the web for feedback and press articles about that firm's practices on DB transfers, the firm’s position regarding processing insistent transfers, whether the adviser charges a fee for a feasibility review to arrive at a yes/ no recommendation to transfer etc.


One thing is certain; this hot potato is not going away and is potentially getting hotter. The FCA is increasing their focus on this area of advice and on firms that have significant activity in this area, which is welcome. The value of transfers are remaining high with some being incentivised, so this issue is likely to grow and come under more scrutiny as time goes on. It is worth employers and trustees taking time to see what more they can do to help their members to find the advice they so clearly need.