The dispute between the FCA and advisory firms that have been making “wholly unacceptable” unsolicited offers to former BSPS members has taken a new turn. The regulator has now formally required two firms, Abbey Lane Financial Associates Limited and Estate Capital Financial Management Limited, to stop making these offers. Both firms have been offering former BSPS members payments way lower than the average calculated redress of £45,000 ($54,000).

“We are concerned that these unsolicited settlement offers, which are likely to be for less money than they are entitled to under the redress scheme, are a deliberate attempt to exclude former BSPS members from the redress scheme”, the FCA said.

In the case of Abbey Lane, it was found that the firm made offers of £100 ($120) to 82% of its BSPS clients.

“We are concerned that these unsolicited settlement offers… are a deliberate attempt to exclude BSPS members from the redress scheme.”

The FCA

“This indicates that the approach taken by the Firm in calculating the settlement offers is flawed and failed to treat customers fairly”, the notice states. “The Authority has no confidence that the Firm has communicated the offers to customers in a way that is clear, fair and not misleading because the Firm has failed to respond to the Authority’s section 165 request letters and requests for information and documents adequately or at all.”

The other firm, Estate Capital, was found to have made offers of £300 ($391) to 83% of its former BSPS members.

British Steel Action Group

Earlier this month, the regulator identified 15 more firms believed to be engaged in similar misconduct, meaning almost 20 firms have now been identified. Most are associated with the British Steel Action Group.

The FCA earlier warned the firms about sending out misleading offers, and told them to:

• withdraw any existing settlement offers currently pending any consumer agreement;
• treat any pending settlement offers as withdrawn; and
• cease making any further offers to former BSPS members who have not made complaints.

The regulator states that firms will need to apply this redress scheme to all consumers – those who have accepted offers as well as those who have not. 

“We will not tolerate this behaviour and we will take further firm action to put a stop to this sharp practice as needed.”