Your portfolio
WHOSE RESPONSIBILITY IS IT ANYWAY?
The last few years have standard investments. extent of a SIPP company’s
seen a number of cases This may reduce the responsibilities.
go through the courts that opportunities for investors accuse SIPP administrators if the provider feels the Carey cases focus on a
of mis-selling or a lack of risks are too high and will legal opinion concerning
due diligence. increase charges. rules in place since 2007
The Berkeley Burke case
That would undermine the
The Berkeley Burke and
on the responsibility to
is a challenge to a Financial nature of these wrappers, protect investors. “There is
Ombudsman Service which are designed to allow a counter argument,” says
ruling the SIPP provider holders to self-invest. Moret, “the regulator made
was responsible for not Another case brought
determining whether a against Carey Pensions
client’s specific unregulated involves an investor who
investment was suitable.
Berkeley Burke argues
claims he was mis-sold a
are merely a tool for tax-efficient
investment and you should always use
the right tool for any job.
If you are concerned, ask questions.
A provider or adviser can indicate
how much exposure a SIPP provider
may have to toxic assets. But until the
Carey judgment is released, confusion
will remain about the extent to which
a SIPP administrator should be
expected to vet a client’s portfolio.
thematic review about
investment due diligence.”
AMPS had been seeking
clarification on these
its responsibilities go only accepting an investment responsibilities back in
so far and that to uphold in a high-risk asset from an 2012, but the FCA “didn’t
this ruling would mean unregulated introducer. engage helpfully with the
SIPP providers will have Moret says there is a
lack of clarity about the
Know your provider
Investors must ensure the vehicle
they wish to use is suitable for the
job they need it to do. Many of those
affected by these cases would not have
invested had they known the true risk
and therefore may not have selected a
SIPP at all.
Caveat emptor remains imperative,
but SIPPs are no more or less
dangerous than they ever were. They
little mention in its 2009
pension. It hinges on Carey
to thoroughly vet all non-
[ SIPPs ]
20 / 21
industry at the crucial
time”, says Moret.
useful, but few expect it to offer the list
of permitted investments that existed
Just right
until 2006. There is also little appetite
Some larger providers operating
for additional regulation.
platform SIPPs are concerned the
“The FCA already regulates the
rulings could cause collateral damage
market pretty strongly,” says Tom
to the market as a whole. They would
Selby, a senior analyst at AJ Bell, “and
certainly welcome a stronger direction what we’re seeing now from some of
from the FCA to clarify the extent of the the cases and with certain providers
administrator’s role.
leaving the market is as a result of that
A list of what the regulator considers
regulation. It just has something of a
to be appropriate assets would be
delayed effect.”
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