The FSCS does not normally take on legal or beneficial ownership of a claimant's assets but sometimes, in order to pursue recoveries, it takes an assignment of rights from the Sipp trustee.
This can be sufficient to conclude the consumer no longer has a benefit under the pension scheme and is able to close their Sipp.
Jenkins, whose assets are not held with the FSCS, and it is unclear whether the FSCS would take them on in any case, has vowed to keep fighting. She says to stop these things from happening again policymakers need to do more to protect vulnerable people from being ripped off.
"There needs to be an alert system when people are trying to transfer out of their pensions, that someone independent goes in and says, 'have you thought about this?'.
"We just transferred our money out and there was no one to stop us. We were told we were getting independent advice and no one said 'stop, don’t do this'.
"Five and a half years after Steve’s death I feel mentally exhausted, but I’m determined to get Steve’s pension returned and will do everything within my power to help bring those who benefited from this to the attention of the authorities.
"I will not stop hoping that someone will pay for the worry and misery they have caused."
The government introduced new rules in November 2021 that allow trustees to pause or block pension transfers if they deem necessary, by raising a ‘red flag’.
They can also raise an ‘amber flag’ if they suspect a potential problem, which will mean the member will have to provide evidence they have taken specific guidance from the Money and Pensions Service before they are allowed to transfer.
Data from XPS Pensions Group shortly after showed ‘red flags’ were raised in half of pension transfers requested in January 2022.
Carmen Reichman is multi-media editor at FTAdviser
