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Hornbuckle increases fees ahead of FCA Sipp clampdown

Hornbuckle Mitchell plans to increase administration fees for group Sipp and SSAS products in response to increased regulatory demands.

In November 2012, the regulator proposed increasing the minimum amount of capital a Sipp operator must hold from £5,000 to £20,000, with a surcharge for providers holding non-standard asset types.

The regulator has also suggested linking capital requirements to each Sipp firm’s assets under administration, meaning those administering the most assets will need to hold the highest amount of capital.

Publication of the final rules has been delayed until the second quarter of next year.

In response to increased regulatory scrutiny, Hornbuckle has now decided to increase admin fees for SSAS and group Sipps “reflecting the complexity of these products”.

Hornbuckle Mitchell senior executive David White says fees for investments in non-standard assets and “complex property transactions” will also rise.

In addition, the firm is increasing the minimum cash balance held against each member account from £1,000 to £1,250, while new business set-up fees for SSAS and single investment Sipp products will fall.

The new pricing structure will come into effect in February next year.

White says: “We have been looking at where the regulator stands and there is increased pressure for us to monitor the investments within our book. They regulator effectively wants us to act as a policeman for the market.

“That comes at a cost and so for those investments that have a higher risk premium and require more reporting, we have decided we need to reflect that within our pricing structure.

“The vast majority of our prices are flat or going down. Those prices that are increasing relate to non-standard investments that carry a high risk premium, larger complex group schemes and complex property transactions.”

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