Over 500 Sipp related complaints made to FSCS

The Financial Services Compensation Scheme has reported receiving more than 500 claims relating to Sipps. In its latest newsletter the organisation said it has continued to see increasing numbers of claims against independent financial advisors that are no longertrading.It said these claims have been in relation to advice these firms have given to transfer funds from existing pension schemes to Sipps.The newsletter stated: "In many cases the Sipp fund was then invested in non-standard asset classes, many of which have become illiquid."FSCS's experience of these claims is consistent with warnings published by the FCA in relation to Sipps and its concerns about the conduct of some firms."To date, FSCS has received more than 500 claims, primarily against the firms which were all declared in default by FSCS in July 2014." {desktop}{/desktop}{mobile}{/mobile} These firms were: TailorMade Independent Limited, 1 Stop Financial Services, Kynaston-Carnoustie Financial Consultancy Limited and Crawford Scott Limited. The FSCS said: "In light of the complexities of these claims, we cannot yet say how muchcompensation FSCS will pay in relation to Sipps during 2014/15. We will provide more information as soon as we are in a position to do so."To establish whether a claimant is eligible for compensation, FSCS will consider the advice given by the advising firm."Determining losses suffered by investors is likely to be complex. This is particularly so where the claims involve both pensions and investment advice, and where some of the assets are difficult to value."To pay compensation, FSCS needs to be satisfied the firms in default can be held legally liable for the losses suffered by the claimant. We may consider making interim payments of compensation where we are not yet able to account for all elements of a claimant's loss."

Over 500 Sipp related complaints made to FSCS

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