The Financial Conduct Authority (FCA) has banned Richard Fenech and Heather Dunne from working in financial services, after the pair operated an advice model that put customers’ guaranteed pension benefits at "significant risk".

Fenech, who was the sole director Financial Solutions Midhurst Limited (FSML), and Dunne, the firm’s appointed representative trading as HDIFA, have been fined £270,646 and £399,817, respectively.

The regulator found that Dunne, whose work was overseen by Fenech, failed to act with due skill, care and diligence when providing pension transfer advice, not taking into account whether the destination of the customers’ investments were suitable.

This was due to the use of a "flawed two-adviser advice model", in which Dunne provided the pension transfer advice, while another firm provided investment advice on the proposed onward investment after the pension transfer had concluded.

As a result, Dunne did not know where her clients’ money was going, leaving them exposed to the risk of unsuitable pension transfers. Overall, she advised around 92% of her clients to transfer out of their defined benefit pension schemes, resulting in over £126m of funds being transferred out.

Fenech was responsible for the oversight of HDIFA’s business. Despite being made aware by FSML’s external compliance consultant of the risk of the two-adviser advice model, he did not stop HDIFA from operating it.

The FCA added that the pair failed to "act with integrity”" because of their involvement in the dishonest provision of a backdate appointed representative agreement to the regulator.

FSML has since been dissolved and HDIFA has stopped trading.

Joint executive director of enforcement and market oversight, Therese Chambers, said: "People must be able to trust the advice they receive about their pension. The actions of these individuals are wholly unacceptable, as they exposed customers to significant financial risk.

"Dunne provided advice which was fundamentally flawed, and Fenech failed in his responsibilities to oversee her work. In doing so, both demonstrated a complete disregard for customers’ needs through retirement, and the suitability of pension transfers, and it is right we ban them from the industry."

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