Pensions cold-calling companies should never again be given public money, a senior MP has said.
In 2014, the Welsh Government gave £118,500 to Pontarddulais-based Celtic Wealth Management, later implicated in the British Steel pensions scandal.
Frank Field chaired a Commons committee which called such firms "vultures" and "parasites".
The Welsh Government said it may "take action" if the company is found to have breached the funding conditions.
Westminster legislation to ban pension cold-calling is due to come into force soon but there are concerns it may not go far enough to stop scams completely.
Two former employees of Celtic Wealth Management have told BBC Wales the company appeared to be targeting people who would be unlikely to benefit from transferring their pension.
Several steelworkers who were clients of Celtic Wealth Management have told the Wales Live programme their pensions ended up in unsuitable funds.
One of them, Roger Morgan, said he feels "upset, annoyed with myself, and cheated" and has had many sleepless nights.
"It was just the not knowing, constantly thinking about whether my money was safe or not," he said.
Financial Conduct Authority (FCA) guidance states it is unlikely to be in an individual's interests to leave a "defined benefit" scheme like the British Steel one.
Celtic Wealth Management claims to offer a range of financial services.
But it is not allowed to give financial advice - it can only "introduce" clients to regulated advisers. It worked with Midlands-based financial adviser Active Wealth.
'It didn't seem like the right thing to be doing'
James Bradwick got a job at Celtic Wealth Management in 2015. He began asking questions about the firm's approach as it seemed to be targeting people with "defined benefit schemes" - often described as "gold plated".
He says he was then asked to leave after just a few hours.
"My role in the company was to phone people from a list of telephone numbers that they purchased," says James.
"The language they used was, 'oh, if you get someone from the council or a public sector worker the financial advisor is more likely to be able to help them, and that's more likely to turn into a sale for the company'.
"So there was a financial reward, if you will, for targeting public sector workers.
"It didn't seem like a win-win for the customer.
"It didn't seem like the right thing to be doing."
Celtic Wealth Management has said it received around £750 each time a client transferred their pension. Active Wealth has said it transferred 64 steelworkers' pensions out of the British Steel scheme.
But Active Wealth has since gone into liquidation, after the FCA intervened and it was no longer allowed to give pensions advice.
The Financial Services Compensation Scheme has told Wales Live it is now dealing with claims from 29 steelworkers against Active Wealth.
Celtic Wealth Management has not responded to BBC Wales requests for comment.
Its owner Clive Howells has previously said the company has acted properly and "had no influence whatsoever" over whether pensions were ultimately transferred.
Frank Field, MP for Birkenhead and chairman of the Commons work and pensions committee which carried out an inquiry into the matter, has called for introducers like Celtic Wealth Management to be banned and not be given public money.
"I would hope now that none of the governments in any of the four constituent countries thinks this is a suitable way of giving entrepreneurs start-up cash," he said.
Independent financial adviser Saran Allott-Davey thinks the Welsh Government should have better understood the line of business Celtic Wealth Management was in.
"On the one hand we have the FCA and the government putting adverts out saying to the public that they shouldn't respond to cold calls about dealing with their pension because it's really unlikely to be in their best interests to do so," she said.
"And then we had the Welsh Government supporting a firm which was doing exactly that, so there's a real lack of joined up thinking there."
A Welsh Government spokeswoman said it gave Celtic Wealth Management the money to create jobs by "delivering a range of financial intermediation services" and a breach of the agreement "could lead to grant monies being recovered".
She added: "The Welsh Government considers the mis-selling of pensions transfers an extremely serious matter and are aware that such allegations have been made against Celtic Wealth and others.
"We understand that the relevant UK regulators are undertaking a wider review of pensions advice, and we will consider the options available under the grant agreement to take action should any breach of the conditions of funding be proven."