Moret labels FSA's Sipp recommendations unworkable
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Suffolk Life has criticised the FSA’s recent calls for Sipp providers to take more responsibility for the suitability of advice claiming they are unworkable and will lead to extra costs.
Speaking at the IFP’s annual conference, marketing director John Moret said: “Taken to its logical conclusion these recommendations would appear to imply that a Sipp operator is expected to determine whether the advice given by an adviser is suitable.
“This seems to be a significant shift in responsibilities which would potentially put a Sipp operator in a difficult if not impossible position not least because a Sipp operator is rarely in position of all the facts.
“Many advisers would take exception to an operator acting in this way. I doubt that it is workable and it inevitably will lead to extra costs being incurred by the operator.”
Good practice examples listed in the FSA’s recent thematic paper on small Sipp operators suggested providers should routinely record and review the type and size of investments recommended by advisers, identify anomalous investments such as unusually small or large transactions and more esoteric investments and request copies of suitability reports.
Moret added that the measures seemed out of line with the expectations of providers of other packaged products.
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