Sipp complaints to ombudsman over risk suitability down 12%

Added 13th February 2017

Complaints about self-invested personal pension scheme (Sipps) investments not matching client risk appetites declined by a third over the past two years, according to new figures obtained by UK IFA firm Salisbury House Wealth.

Sipp complaints to ombudsman over risk suitability down 12%

The number of complaints received by the Financial Ombudsman Service (FOS) from individuals unhappy with the level of risk allocated to their Sipp portfolio has declined by 12% to 397 in the last year, down from 450 in the previous year.

The figures were obtained by a Freedom of Information (FOI) request said Salisbury, with complaints about risk allocation down nearly a third (32%) in just the last two years.

The firm said the decline in complaints is down to fund managers “taking greater pains to accurately assess and regularly review client risk profiles” as well as financial advisers increasingly guiding clients to avoid investing their Sipps in previously popular high risk schemes.

“The trend comes after Sipp investments in risky schemes, including investments often regarded as Unregulated Collective Investment Schemes (Ucis) such as Harlequin Property, saw investors lose, in some cases, large portions of their savings,” said Salisbury.

Rise in Sipp claims

It comes as last July, the FOS revealed that payouts over Sipps claims have more than doubled due to an increase in high risk Sipp investment claims.

Last week, the lifeboat fund reported that complaints about Sipps have increased in the nine months between April and December 2016.

Tim Holmes, managing director of Salisbury House Wealth, said: “Clients need to know their money is safe in their financial advisor’s hands and that their preferences will be followed.

“Savers need to trust their financial advisor, especially when they are putting their money away for long periods of time. The decline in complaints reflects the seriousness with which advisors take their client’s attitude to risk when choosing where to invest their pension money.”

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Monira Matin

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Monira joined International Adviser in March 2016 from Informa Global Markets where she worked as a eurobond reporter for over two years, covering fixed income markets. She has previously held a number of editorial positions covering politics, insurance and technology. Monira has a degree in Journalism and Economics from City University.

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