Sipp providers with clients exposed to a failed bio-fuel investment project have defended their due-diligence processes and say responsibility for investment suitability lies with the adviser.
Last week, Money Marketing revealed a total of 1,500 people, mostly Sipp investors, are facing losses of up to £32m after Sustainable Agroenergy, Sustainable Wealth Investments and Sustainable Growth Group entered administration on March 15.
Hornbuckle Mitchell has confirmed 120 clients are exposed to the scheme, Rowanmoor Pensions has 50 clients exposed and Curtis Banks has 12. Berkeley Burke is understood to have clients exposed but could not be reached for comment.
Hornbuckle Mitchell head of sales Stewart Dick says: “We have written to clients and are liaising with the administrators to ensure maximum recovery. Our role is to look at HMRC issues and make sure the investment is compliant. Investment suitability has to come from the adviser.”
Rowanmoor Pensions head of pensions technical services Robert Graves says: “We think it is our role to make sure any investments through our Sipp are bona fide and compliant with HMRC rules. We have a thorough due-diligence process but ultimately it is up to the IFA to determine if it is suitable for their client.”
Syndaxi Chartered Financial Planners managing director Robert Reid says: “Providers need to address due diligence because an increasing number of customers are suffering detriment due to failed Sipp investments.”