Thousands of ex-service personnel have suffered financially after being advised to transfer out of the Armed Forces Pension Scheme (AFPS). At Hugh James, we specialise in recovering compensation for veterans who were given unsuitable financial advice.
This case study highlights how our Financial Mis-Selling team helped one client secure over £67,000 in compensation following inappropriate advice to transfer out of the AFPS.
Background
Mr X served in the Army Infantry from August 2003 to October 2012, during which he accrued safeguarded benefits under the AFPS.
In late 2014, he was approached by an Independent Financial Adviser (IFA) who recommended transferring his AFPS pension to a personal pension with Royal London. Mr X, a low- risk investor, was persuaded that this transfer would generate better returns. Relying on this advice, he transferred £21,972.42 from the AFPS into a pension scheme with Royal London.
Years later, following concern that Mr X had about the performance of his new pension and suitability of this advice, Mr X, an existing Hugh James client, approached us to investigate.
Our investigation and legal approach
Our Financial Mis Selling team carried out a thorough review, examining:
The IFA’s regulatory obligations to consider:
- The comparative benefits of the AFPS versus the Royal London pension, and
- Mr X’s personal financial circumstances and long-term needs.
We concluded the advice was unsuitable and not in Mr X’s best interests. The IFA had:
- Failed to conduct a proper needs assessment,
- Did not explain the guaranteed nature of AFPS benefits, and
- Did not demonstrate that the transfer was appropriate.
Since the IFA firm had ceased trading, we submitted a claim to the Financial Services Compensation Scheme. (FSCS)—the UK’s statutory body that provides redress where no other route is available due to firm failure.
Our claim included compensation for:
- The hypothetical value of the lost AFPS benefits,
- Lost investment growth, and
- Any fees or charges incurred.
On 6 September 2024, the FSCS upheld our claim and awarded £67,596.40 in compensation. Importantly, this sum reflects the value Mr X would have retained in the AFPS and does not affect his Royal London pension, which remains intact.
Commenting on his case and working with Hugh James, the individual said,
“Outstanding Service and Expertise – Highly Recommend Hugh James.
I recently had the pleasure of working with Hugh James on a legal matter, and I couldn’t be more satisfied with the outcome. From the very beginning, the team provided exceptional service, guiding me through every step of the process with professionalism and care. The solicitor handling my case was thorough, knowledgeable, and always available to answer my questions. Their attention to detail and commitment to ensuring a successful result were evident throughout, and I felt reassured knowing I was in capable hands.
Thanks to their expertise and diligence, my case was handled efficiently, and the outcome was a great success. I would highly recommend Hugh James to anyone in need of legal assistance.”
Neil Stockdale, Partner in our Financial Mis-selling team, commented:
“This case is a clear example of the lasting financial impact that unsuitable pension transfer advice can have on members of the Armed Forces. Many veterans remain unaware that they may have been mis-sold their pension transfer and could be entitled to substantial compensation.
At Hugh James our message is simple: if you transferred out of the Armed Forces Pension Scheme following financial advice, it is worth having that advice reviewed. You may have a right to redress, even if the transfer took place many years ago.”
