The Sipp market is rife with “backhanders” and providers pocketing undisclosed earnings, industry insiders claim.Pal Partnership business development manager Richard Mattison says the most common source of undisclosed earnings are from interest rates on cash. He says interest rates paid on cash held in Sipps can vary by as much as 3 per cent and many providers receive one rate from the bank across the cash held in its Sipp book but pay less to clients and pocket the difference. He says some Sipp providers operate panels of lenders, solicitors and property managers for customers wanting to hold commercial property in Sipps and add on undisclosed sums if clients go outside the panel. Mattison says these forms of non-disclosed earnings and payments often represent an essential income stream for low-charge Sipps and it is unclear whether regulation next April will curb this. He says: “The Sipp market is full of backhanders. Interest rates from banks is the big one as there are millions of pounds from Sipp customers sitting in bank accounts.” Suffolk Life director of sales and marketing John Moret says: “Some companies are not disclosing as much as they could and are earning more money in interest than from charges.”
I am concluding this series of articles, updating an overview of the major investment asset classes, by summarising the relationship between the current and expected behaviour of equities against the main alternatives.
The European Parliament committee investigating the Equitable Life crisis has warned policyholders that there will be no “pot of gold” for them at the end of their inquiry. The committee said the enquiry is more an opportunity to explain what happened to policyholders and scrutinise legislation and propose recommendations to ensure such a scenario does […]
Prudential believes the equity-release sector is likely to double in the next two years to well above 2bn. Lifetime mortgage director Ali Crossley says such a rise is well below what many would hope for but is realistic. Pru launches its direct-sales team of 20 equity-release advisers next week and plans to grow the team […]
The FSA has publicly censured GD Tancred Financial Services Limited for failing to clearly outline the risks of income withdrawal to customers with pension pots of less than £100,000.
Mark Martin, Manager of the Neptune UK Mid Cap fund Brexit news has caused a wave of turbulence across financial markets, with both UK equities and sterling plummeting in the immediate aftermath. UK mid-caps have borne the brunt of the selling so far, with housebuilders and banks being two of the worst performing sub-sectors. However, for […]
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