FCA fines Standard Life Assurance £30m over pension sales failures
The Financial Conduct Authority fined Standard Life Assurance £30.7m on Tuesday, for failures related to non-advised sales of annuities.
An annuity is a retirement income product that can be bought with some or all of a customer’s pension pot, and pays a regular income either for life, or for a set time period.
A customer requires accurate information when choosing an annuity, the FCA said, as it is a complex financial product.
That was said to be especially so for non-advised sales, where the customer selected the annuity based on factual information and did not receive financial advice, the regulator said.
According to the FCA, Standard Life Assurance failed to put in place adequate controls to monitor the quality of the calls between its call handlers and non-advised customers.
It also offered its front-line staff large financial incentives to sell annuities, which encouraged them to place their own financial interests ahead of their customers.
As a result, there was a significant risk that the company's call handlers would fail to provide customers with the information they needed to choose an annuity appropriate to their circumstances.
Mark Steward, executive director of enforcement and market oversight at the FCA, said: "Standard Life's controls needed to place fairness to customers at their heart.
"Here, the financial incentives available to staff for selling non-advised annuities by telephone created conflicts which led to unfair outcomes for some customers. Firms must have controls in place to ensure they are prioritising fairness to customers.”
Standard Life Assurance has already contacted potentially affected customers as part of its past business review.