A few thoughts on the past few weeks in the SIPP market
Originally sent 20 February 2019
I wanted to share a story from BBC News a few days ago, about a 55 year old factory worker who has lost more than £30,000 of his pension by investing in storage pods. You can read the full story here.
It caught my eye because it is very rare for a SIPP story to make the main BBC news page, let alone appear in the Top Ten Most Read list. I wanted to share this story for two reasons. Firstly, it reminds of the very real impact that situations such as this mean for real people. They’re behind every headline of the latest investment that collapses, taking their retirements with them.
Secondly, some of the SIPP operators that ran their businesses this way are still operating. They are still accepting business and, incredibly, some advisers continue to use them. I say use, and not recommend, very deliberately.
For some, a cheap headline annual fee can be tempting. Others may be reassured that an acquisition or a clever ownership structure has insulated against the liabilities of the past. They may prove to be right. But if I learned that my adviser recommended me a SIPP provider with hundreds of pending claims against it sitting with the Financial Ombudsman Service, or dozens of clients taking court action against them for past business failings, I don’t think I’d be reassured by warm words, a capital requirement being met, or a liability mitigated because another firm had bought them and left the liabilities behind.
I’d feel the same way if the recommendation had been made years earlier. And I don’t think that I’m dissimilar from any other average client.
Your Future SIPP will launch soon, with Curtis Banks as the provider. We’re a listed firm, and so we’re financially strong and need to be governed to a higher standard than privately owned businesses.
Taking responsibility for the retirement savings of an individual is a serious business. We’re ready for a serious conversation about finding the right solution for your next client, and your past recommendations too.
Greg Kingston, Group Communications Director, Curtis Banks.