There are two reasons which explain why this problem occurs.

Using UTF-8 characters in a non-UTF-8 forum

If your members are using UTF-8 characters, perhaps copied into their posts from an editing program, but you did not use UTF-8 when you set up the forum, these UTF-8 characters (special characters like £) will not show up properly in posts.

There are two solutions. You can either remove the "special" UTF-8 characters from the post or convert your forum to UTF-8.

MS Word "smart quotes"

MS Word uses non-standard characters called "Smart Quotes". The character encoding is Windows-1252 or CP-1252, and uses ISO-8859-1 reserved control codes in positions x80 up to and including x95 to represent some special characters (typographically proper quotes, dashes, euro sign, and others). These characters are not compatible with ISO-8859 or UTF-8 character encodings, and should not be used in SMF forums, which do not support Windows-1252 characters. To avoid the problem, members may disable "smart quotes" in Word, and manually remove the non-standard characters wherever they appear on the forum.