Edinburgh-based SIPP operator Forthplus Pensions has gone into administration after a string of complaints to the Ombudsman about the firm’s due diligence.

Yesterday the directors appointed insolvency practitioners Leonard Curtis Business Solutions Group as joint administrators. 

Forthplus was unable to meet its regulatory capital adequacy requirements and the board of the company recognised it was no longer able to operate. 

The FCA said this was compounded by a large number of complaints from clients to the Financial Ombudsman Service related to the firm’s due diligence prior to taking on pension savers. 

The ombudsman service has issued several provisional assessments which found that Forthplus had not undertaken adequate due diligence and therefore had not treated its customers, “fairly and reasonably.”

The FCA said that as Forthplus did not agree with these provisional assessments, the Ombudsman service was preparing to issue final decisions. Had the complaints been upheld and final decisions issued, further claims against Forthplus were expected. 

Following advice from Leonard Curtis the directors made the decision to place the firm into administration.

The FSCS is now investigating whether there are any claims that meet the qualifying conditions for compensation.

The FCA says all clients of Forthplus should be alert to the threat of fraud from cold call firms claiming to be from Forthplus, Leonard Curtis Business Solutions Group or any company claiming to be involved in the Forthplus administration.

Although Forthplus is in administration the FCA says that it can continue to operate existing pensions while the administrators look for a new operator.

The administrators will continue to make regular payments from clients’ SIPPs for anyone already in drawdown. The administrators will also continue to accept regular contributions from clients into their SIPPs. Pension assets are held by Forthplus Trustees Limited, which has not entered administration.

The administrators will be writing to clients within the next 7 days.

Forthplus described itself on its website as: “We are a transparent and compliance focussed company, holding only vanilla standard investments and operating a genuinely clear and competitive pricing structure.”

Financial Planning Today has asked Forthplus for comment.