£31m fine over pension firm’s ‘Mad March’ rip-off scandal

PENSION firm Standard Life Assurance has been hit with a £ 31m fine after toxic ‘ Mad March’ bonuses for staff helped trigger a mis-selling scandal.

Its call centre workers overcharged thousands of customers when they used their savings to buy an annuity, which gives a guaranteed annual income for life during retirement.

Many were not told they might qualify for higher payments than normal because they had lower life expectancy, for example because they smoked or had a heart condition.

And Standard Life Assurance put employees under huge pressure with a bonus programme which rewarded aggressive sales tactics, according to the Financial Conduct Authority.

A fifth of eligible staff more than doubled their monthly salary through the scheme.

At the end of every tax year, Standard Life Assurance ran a ‘Mad March’ push where the money on offer was higher than usual. The FCA said this environment led to customers being ripped off between 2008 and 2016. It has now fined Standard Life £30.8m.

Mark Steward, of the FCA, said last night: ‘ The financial incentives available to staff for selling non-advised annuities by telephone created conflicts which led to unfair outcomes for some customers.

‘Firms must have controls in place to ensure they are prioritising fairness.’

Standard Life Assurance set up a compensation scheme when its failings became clear. Around 27,000 people were mistreated, and £95m has been paid out.

The business was part of savings group Standard Life Aberdeen (SLA) until last year, when it was sold to insurance firm Phoenix Group. The deal included money from SLA to cover fines and compensation.

Susan McInnes, a director of Phoenix, said: ‘While this is an historic issue and one we were aware of when we acquired Standard Life Assurance, we would like to apologise to affected customers, all of whom we have already been in contact with as part of the programme of customer redress. We have also reviewed and updated our telephone practices.’