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Hornbuckle victory over £300,000 investor claim for Sipp losses

The Pensions Ombudsman has rejected a £300,000 investor claim against Hornbuckle Mitchell for losses in three property schemes in his Sipp.

Julian Holy claimed Hornbuckle failed to carry out due diligence on the property-related Sipp investment recommended by his IFA, Bentley Leek Financial Management.

Holy also argued the Sipp provider did not subsequently monitor the performance and security of the investments. The retired property lawyer said these actions caused him to lose £300,000 from his Sipp.

But in her judgement, deputy Pensions Ombudsman Jane Irvine said: “The complaint should not be upheld against Hornbuckle because, in my view, they had satisfactorily carried out rudimentary due diligence checks which were adequate at that time on the investments before allowing them to proceed.”

Holy established his Sipp in November 2006 and accepted the recommendation of Bentley Leek Properties to invest £100,000 each in three unregulated high risk property related investments promising high returns.

He invested in UK property developments through Bentley Leek Properties JV2 in June 2007 and BLP JV3 in September 2009.

In August 2007, he also invested in Dubailand Development, an overseas property development managed by a Mauritian company.

All three ventures ran into difficulty because of alleged issues with financial management by Mr M Bentley Leek and Mr M Dervish, directors of all three schemes.

The ombudsman said Holy’s claims against Hornbuckle could not be supported and were based on “fundamental misunderstandings”.

It said he was responsible for assessing the Dubai investment and the onus was on him to raise any concerns with Hornbuckle. The Sipp provider was judged not responsible for the suitability of investments of advice given.

Evolve Financial Planning director James Norton says investors must take some responsibility for esoteric investments.

He says: “When things go wrong it’s all well and good to chase people who you think have deep pockets but blame has to be apportioned where it is due.”


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There are 2 comments at the moment, we would love to hear your opinion too.

  1. So he was a property lawyer and then claims that the SIPP (Self Invested) provider should be responsible for his losses – thank god sense prevailed!

  2. Don’t kid yourself that god had anything to do with it!

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