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FSCS hit with more than 200 claims over collapsed Sipp provider

The Financial Services Compensation Scheme has received more than 200 claims against the collapsed Lifetime Sipp Company in less than two months.

Company data provided to Money Marketing by the FSCS showed 19 claims had been received as at 30 May.

However, the FSCS confirmed this week that the number of claims has now ballooned to 220.

Administrators Kingston Smith & Partners previously estimated compensation claims against the Sipp provider would be valued around £56m.

Embattled Sipp provider reports profit as claims swirl

Around £22m of claims were from clients who have no insurance, while £34.5m may have insurance.

Claims against the against the Sipp provider were opened in April but the FSCS is yet to confirm any breakdown about the value of claims until they have been assessed.

The time to process the claims has been approximated as 375 hours and at a cost of £280,000.

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Comments

There are 6 comments at the moment, we would love to hear your opinion too.

  1. Jeez! £746 per hour (£5,200 per day) to investigate these complaints. Are they taking the absolute ****??

    I think it’s time to ditch my directors job and return to contracting for the FSCS.

    I’d be more than happy and sufficiently capable to investigate and conclude all 200 complaints at an hourly rate of £100 to save them £222k.

    These costs are outrageous and the FSCS should be forced to provide a detailed breakdown and to justify them to the industry funding them.

  2. Nicholas Pleasure 27th July 2018 at 10:05 am

    Don’t worry…we’ve got this.

    I’ll just get my chequebook.

    You carry on and enjoy your £420,000 salary and £75,000 bonus, Mr Bailey. We’ll clear up the mess left by your failed organisation.

    Lucky that you’re putting a stop to important stuff like platforms providing research tools and training. There could be some real client detriment there.

  3. No doubt requiring more funds from the innocent!

  4. “clients who have no insurance”? Should that not be “from clients whose intermediary firm has no insurance”?

    Also “The time to process the claims has been approximated as 375 hours and at a cost of £280,000.” That’s almost £750/hr. No wonder our FSCS levies are so huge.

  5. I am confused – A SIPP is an investment under FSCS and has maximum compensation of £58,000 (unless invested in insured funds)?
    So 220 x £58,000 £12,760,000 so far;
    Not overly complicated and what have the clients lost unless lifetime Sipp has absconded with their funds or re-registered any property? If it is a mis-sold issue then that is an individual cases via FOS and complaints have to be brought, surely this will fall on the adviser?
    Of course this is a direct consequence of over regulation and capital adequacy that has left Lifetime Sipp insolvent.

  6. Dont panic guys ….

    Remember Mark Neale wants us to think the FSCS is fair….

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