View more on these topics

FSA warns Sipps not always most suitable

The FSA says it is concerned that investors are being put into Sipps when a personal pension or stakeholder may be equally appropriate and potentially cheaper.

The regulator has carried out a ‘small thematic project’ to review financial planning advice and highlighted concerns that advisers are recommending Sipps purely on the basis that they offer a wider fund choice and not because of the Sipp’s allowance of self-selection of actual investment assets.

The FSA says: “Under these circumstances, a stakeholder pension or personal pension may equally satisfy a customer’s needs, potentially at a lower cost. Sipp providers operate a variety of charging structures and advisers need to ensure that they carry out proper cost comparisons with the alternative personal pension and stakeholder arrangements.”

Advisers should be able to demonstrate that the investor requries the potentially greater investment flexibility and control afforded by Sipps, it adds.

The FSA stresses that the RU64 rule applies to Sipp advice and so advisers must provide evidence that the arrangement is at least as suitable as stakeholder.

In other work, the regulator says it has completed its planned visits to 10 adviser firms as part of its multi-manager thematic work, as first revealed by Money Marketing, and says it will publish the findings in November.
It also fired off a warning about financial advisers branding themselves ‘independent’ when they are not and warns that any reference to ‘statutory rights’ in client documentation must be accompanied by further details.



Policy is priority

No news escaped from the Gleneagles life & pensions summit held last week. This was the event at which Callum McCarthy chose to fire the starting pistol of the retail distribution review last year.

Pension pressure for Brown

Prime Minister Gordon Brown faced a fierce attack from the Tories and pension campaigners over his treatment of victims of occupational scheme collapses in the first-ever Tory fringe event at a Labour conference.Pension campaigner Ros Altmann told the audience of over 200 people that the pensioners who lost out are “living proof that Gordon Brown […]


The Brunner Investment Trust – April 2017

Welcome to the latest update for The Brunner Investment Trust PLC from the Trust’s portfolio manager, Lucy Macdonald. Market Review Global equities have rallied over the first quarter of 2017, buoyed by signs of strengthening growth and optimism over company earnings, although this rally has faded towards the quarter end. US equities posted their strongest […]


News and expert analysis straight to your inbox

Sign up


    Leave a comment