FCA bans Paul Steel for unsuitable defined benefit transfer advice with £850k to be paid in redress

He will also pay £850,000 to the Financial Services Compensation Scheme (FSCS). Mr Steel provided unsuitable advice to customers to transfer out of defined benefit pension schemes, including the British Steel Pension Scheme (BSPS). He also showed a lack of honesty and integrity in selling his client book for less than its value, to himself. This meant that customers who had lost out from the poor advice could not pursue EMF for redress. 

Between 2015 and 2018, more than 480 clients were given defined benefit transfer advice by EMF. Over £140m of pension assets were transferred as a result.  Overwhelmingly (86%), this advice failed to meet the required standards. In providing the advice, Mr Steel failed to collect the right information and/or disclose the risks of transferring. 

As a result of his conduct in selling his client book, the FCA sought and obtained a freezing injunction, and brought proceedings in the High Court seeking redress for customer losses. It agreed to settle those proceedings on the basis of Mr Steel’s agreement not to contest the FCA’s penalties. 

Therese Chambers, Joint Executive Director of Enforcement and Market Oversight said: 

‘Mr Steel failed to provide suitable pension transfer advice. But he also failed to act with honesty and integrity when he improperly sold the firm’s assets for less than their value - to himself - so that he could enjoy the profits of the business without the burden of the risks that he had created. We are determined that those who fail in their duties to their customers take responsibility for paying towards redress and do not expect the FSCS, and the vast majority of firms who do the right thing, to pick up the tab for their failings.’

The FCA imposed a fine of £3,694,400 on Mr Steel. However, it agreed not to enforce this provided Mr Steel pays £850,000 to the FSCS. This represents substantially all of Mr Steel’s remaining assets and ensures that he will contribute to the cost of compensating customers who received his poor advice. Without this settlement, most or all of Mr Steel’s assets would have been spent on the High Court proceedings rather than compensating consumers.

Notes to editors

1. Final Notice 2023: Mr Paul Steel[1]
2. Estate Matters Financial Ltd was trading as “Pension Matters”.
3. British Steel Pension Scheme - our approach to enforcement[2]
4. The FCA launched High Court action against Mr Steel in February 2021[3].Those proceedings have now been settled. See paragraph 2.13 of the Final Notice. 
5. As at 27 June 2023, FSCS has paid out £1,752,125.71 in relation to claims valued at £4,539,474.73 to clients to whom EMF has provided unsuitable pension transfer advice. 
6. Find out more information about the FCA.