FCA issues SIPP transfer alert
On 28 April the FCA issued a statement where they state they are alerting firms to their requirements when they give advice on self-invested personal pensions, giving their view and key messages. Within this they also set out some of the failings that they have encountered when reviewing this type of business.
The alert talks about the need for firms advising on transfers or switches into SIPPs to ensure they are advising on the transaction as a whole and not just on the wrapper. This is seen as especially important when the transfer or switch is coming from a scheme where the investments have been limited or bear no relation to the end benefits, such as a defined benefit scheme. Although the responsibility for the transfer and investment advice as discussed in the alert is clearly aimed at adviser firms it is important to deal with a provider who also looks at the underlying investments at outset, where known, and review them prior to establishing the SIPP. We at Talbot and Muir took heed of the FCA’s warnings this time last year and as a consequence we have already reviewed the type of investment we consider appropriate for our clients against the FCA’s CP12/33 definition of standard assets. This culminated in the creation of our Permitted Investment List. Full details of the alert can be viewed here.