A two-man Welsh advice firm has racked up almost £2m in contingent liabilities from complaints about pension transfers to Sipps, Money Marketing has learned.
According to annual accounts published on Companies House for the 12 months ending 31 July 2017, Kingsway Wealth Management is “vigorously” contesting a number of compensation claims against it.
The firm is potentially on the hook to pay out more than £1.9m compensation relating to the complaints.
The firm says it has put aside £232,000 for liabilities where the amount can be accurately determined because the Financial Ombudsman Service has made a decision on a claim or given notice it will do so.
However, the document also says there are significant uncertainties regarding the allocation of liabilities between the advisers and the scale of losses, so it is not possible to say when any settlement will be payable.
A search for Kingsway on the FOS website section on pensions and investments decisions shows seven upheld decisions against it since April 2013. All of these were where a client was advised to transfer from another pension to a Sipp, five of them concerning unregulated investments.
Examples of unregulated investments include the Eco Fuel Green Oil fund, other “green oil” investments and Cyprus One, an overseas property scheme.
Kingsway, based in Wrexham, Wales, declined to comment.