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Liberty Sipp faces fresh claims over unregulated investments

A law firm is set to issue more than 30 cases against Liberty Sipp in what it believes is the largest number of claims issued against the provider to date.

Anthony Philip James & Co alleges the Sipp provider is responsible for the misselling of Sipps between 2011 and 2013.

It says it has up to 700 investors who allege they have suffered significant losses as a result of unregulated pension investments through the provider.

According to the firm claimants’ pensions were invested by Liberty Sipp into a range of schemes, including Ethical Forestry and Global, following lead generation from an unregulated introducer that is now the subject of a criminal investigation by the Serious Fraud Office.

APJ solicitor Glyn Taylor says: “Liberty Sipp has frequently argued that only a small proportion of legacy investors have lost money through unregulated Sipp investments, however from the cases we have on our books at the moment, we estimate that as many as 10 percent of Liberty’s investors have been affected and we believe there could be many more.”

He adds: “Through this action we hope to establish that Liberty Sipp acted unlawfully when it received introductions from an unregulated introducer and by accepting high risk, speculative, risky and illiquid investments, Liberty Sipp breached their obligation to act honestly, fairly and professionally in accordance with the best interest of their customers as set out by the FCA conduct of business rules.”

Earlier this month, Money Marketing reported another group of investors is taking action against Liberty Sipp over allegations it was responsible for losses incurred from risky investments.

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Comments

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

  1. No doubt we will see another bullish rebuttal from Liberty that they didn’t ‘sell anything’ which is true but they did…………

    Section 27 Financial Services Marketing Act 2000

    Agreements made through unauthorised persons

    (1) An agreement made by an authorised person (“the provider”)—

    (a) in the course of carrying on a regulated activity (not in contravention of the general prohibition), but

    (b) in consequence of something said or done by another person (“the third party”) in the course of a regulated activity carried on by the third party in contravention of the general prohibition, is unenforceable against the other party.

    (2) The other party is entitled to recover—

    (a) any money or other property paid or transferred by him under the agreement; and

    (b) compensation for any loss sustained by him as a result of having parted with it.

    (3) “Agreement” means an agreement—

    (a) made after this section comes into force; and

    (b) the making or performance of which constitutes, or is part of, the regulated activity in question carried on by the provider.

    Whilst without doubt these investments will have been made under the most robust of t&C’s, no t&c’s will protect against non compliance of the Regulation and indeed if they were overly protective they would fall foul of the unfair contracts act.

  2. Good point, Paul, but “According to the firm claimants’ pensions were invested…” – not the claimant’s *own* assets.

    So it would appear there is no money etc transferred by him to be recovered (section 27(2)(a)) nor “any loss sustained by him *as a result of having parted with it*” (section 27(2)(b)).

    This problem is nowhere near as simple to tackle as it appears. Even if a scheme member was successful in such a claim, and even if the defending scheme could afford to pay up, you’d need to think very hard about how to structure the compensation in order to avoid HMRC coming after you for pension liberation sanction charges.

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