County Durham-based advice firm D&G Financial Services has failed with the Financial Services Compensation Scheme.
The FSCS has received two claims against the firm relating to pension advice.
A spokesperson for the lifeboat scheme said that one claim has been upheld and another still in progress.
It also confirmed the claims are associated with British Steel Pension Scheme transfers.
According to the FCA register the firm has not been authorised by the regulator since January 2021 with Companies House showing it was dissolved in November 2021.
Last month (December 2023) the lifeboat scheme announced that Cheshire-based advice firm The Chambers Partnership had also been declared as failed.
At the time the FSCS had received four claims against the firm for various types of financial advice.
In an interview, published last week (January 4), FSCS interim chief executive Martyn Beauchamp told FT Adviser that while firm failures were expected the current level remains "too high and needs to be addressed".
Late last year, the FCA ran a consultation on capital requirements for personal investment firms as it looks to reduce the amount of compensation FSCS needs to pay to consumers.
The regulator proposed a “polluter pays” framework which will require personal investment firms to set aside capital so that they can cover compensation costs.
Any firm not holding enough capital will be subject to automatic asset retention rules to prevent them from disposing of their assets.
Beauchamp told FT Adviser: "This goal is something FSCS strongly supports, as poor investment advice is still driving large numbers of complex claims which are often costly for us to resolve.
“These costs are passed onto the wider industry through FSCS’s levy, which we know creates a burden on many firms."
alina.khan@ft.com
