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No FSA guidance on orphaned clients

The FSA has no plans to publish guidance for orphaned Sipp clients and is likely to take a reactive approach to firms operating illegally as it has no ready means of identifying them.

The regulator has published a list of 41 newly authorised firms and 22 interim authorised firms on its website. But there is no official list of how many firms regulated for other business have successfully applied to be regulated for Sipps’ so-called varied permission.

At the last count, the FSA had 135 applications for authorisation, leaving 72 firms that applied for varied permission. It says it has not yet refused an application but industry figures are calling on the FSA to clarify what will happen to orphaned Sipp clients of firms which have failed to secure or apply for authorisation.

An FSA spokesman says: “It is unlikely that we would provide guidance to orphaned clients. If firms do not apply for authorisation, we would have no means of identifying them. We are likely to take a reactive approach but once we are aware of firms operating illegally, we will take appropriate action.”

AWD Chase de Vere Consulting manager Richard Sheppard says: “The fact that the FSA does not know who these clients are does not preclude them from putting out guidance for these clients. It should be taking a far more proactive approach.”


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