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DB transfer firm appoints liquidator after restriction hits income

Paraplanning firm Heather Dunne Consulting, which was connected to a pension transfer outsourcer, has gone into voluntary liquidation.

DB transfer firm appoints liquidator after restriction hits income

Paraplanning firm Heather Dunne Consulting has gone into voluntary liquidation after the advice business it serviced restricted its pension transfer permissions.

Founded in 2002 by adviser Heather Dunne, Heather Dunne Consulting provided paraplanning and support services for IFAs which carry out defined benefit (DB) transfers. The firm's biggest client was HD IFA, which was also run by Dunne.

In June 2017, HD IFA was one of a number of DB transfer outsourcing firms to suspend its transfer permissions after discussions with the Financial Conduct Authority (FCA).

This permission restriction, along with a slowdown in the pension transfer market, contributed to Heather Dunne Consulting going into liquidation, Dunne told New Model Adviser®.

‘When I had the visit from the regulator in June 2017 and they put me [HD IFA] on voluntary suspension, it meant Heather Dunne Consulting lost its biggest client over night,’ she said. ‘HD IFA continued to pay its principal and everyone else but not my other company.’

This drop in revenue from HD IFA’s pension transfer business coupled with compliance fees meant Dunne’s accountant advised her to put Heather Dunne Consulting into voluntary liquidation. A liquidator was appointed on 4 September. 

The largest creditors for Heather Dunne Consulting will be the company's professional indemnity insurer (which will receive a refund from the policy cancellation), its accountant and two external loans which Dunne has personal guarantees on.

‘I personally am not walking away from any debt, I am taking a significant amount of debt on,’ she said.

With the collapse of the paraplanning firm, 10 staff have been made redundant - although most of these have found new jobs elsewhere. Prior to the FCA permission restriction, Dunne employed 20 staff last summer.

Dunne has now founded a new paraplanning and support firm, the Pensions Experts, which will trade from her house and continue the work which Heather Dunne Consulting did.

Pension transfer firm

The pension transfer outsourcing business HD IFA was an appointed representative of Financial Solutions Midhurst Limited until June of this year.

Dunne said in March 2018, the FCA gave HD IFA permissions to start trading again. However prior to her starting the pension transfer business again, Dunne’s principal Financial Solutions Midhurst Limited de-registered it in June.

This means HD IFA is now trying to find another principal or go directly authorised with the regulator. Currently its status on the FCA register says: ‘This is an AR that is no longer an agent of an authorised firm.’

Dunne said she is also considering putting the sole trader HD IFA into cessation.

According to Dunne HD IFA is currently facing 10 claims over one advice firm which it did DB transfer advice for in 2012. This adviser, which has since closed down, was putting clients into unregulated investments, she said, after HD IFA provided the DB transfer advice.

‘The nearest we came to non-regulated [investments] was that adviser,’ she said. ‘To me that was their advice and not mine.’

The outcome of these claims remains uncertain however Dunne indicated she will not walk away from any liabilities.

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