The Financial Services Authority’s (FSA) recent warning over unregulated collective investment schemes (Ucis) held in Sipps has caused a wave of complaints against advisers.
Damian McPhun, partner at Beale and Company, who represents advisers and their insurers, said the more the regulator drew attention to poor Ucis and Sipp advice, the more claims were likely to be made.
‘There is a concern that once the FSA gets a bee in its bonnet it can almost encourage people to make claims, even though they were perfectly happy with the advice given and were aware of what was happening,’ he said.
‘The concern is that, with the FSA’s continued focus on Ucis, there will be more attention on this and more claims coming through.’
Martin Taylor, head of client relations at claims management firm Rebus Investment Solutions, said January and February had been ‘crazily busy’ with Ucis complaints. He said the firm was handling claims from 500 clients against 100 advisers on around £35 million of assets.
The FSA in January issued a warning to advisers over unsuitable advice to transfer assets to Ucis held in Sipps.
It said it was concerned some advisers were advising on pension transfers and switches without assessing the investments.