Speaking to International Adviser, Davies revealed the international pension provider, at a “business as usual meeting” with the UK’s Financial Conduct Authority (FCA), had had a “positive dialogue” about non-standard assets within its self-invested personal pension schemes (Sipps).
“In reference to holding non-standard assets within a Sipp, we had some positive dialogue with the FCA, and have confirmed that Momentum’s policy is entirely aligned to the regulator’s view of best practice, and we would expect other Sipp providers to adopt a similar policy,” he said.
Davies added that the “whole sector is now under a heightened level of scrutiny” since February when the FCA ordered international advisory firm deVere UK to “immediately cease” providing advice on overseas pension transfers.
A further 17 firms, including Dubai-based Holborn Assets, have agreed to stop any activities related to pension transfers since last year.
The UK released a green paper in February looking at whether to relax the rules around defined benefit (DB) transfers of small pension pots under £30,000 ($37,000, €35,000) without financial advice.
Adviser enquiries
Davies explained that Momentum Pensions had received a number queries from advisers to clarify exactly what is considered a standard and non-standard asset.
Around 80% of Sipps are now bought on-platform and consist of liquid ‘standard’ assets such as listed securities, gold bullion, unit trusts and ETFs.
The remaining specialist Sipps are bought off-platform from specialist boutique advisers and are made up of illiquid ‘non-standard’ assets such as unregulated collective investment schemes (CIS) and structured notes.
Davies revealed that non-standard assets “equate to less than 1% of our entire Sipp portfolio”.
Email blast
In an email blast sent out by the provider and seen by IA, Momentum Pensions reiterated the definition of standard assets in relation to non-UK based fund and CIS.
“One thing that the advisers wanted us to clarify, hence the email blast, is what is in the standard category and what is in the non-standard category particular in relation to overseas funds,” said Davies
“Even if the fund may appear to be entirely acceptable, liquid and daily-traded, it still needs to be traded on a recognised exchange or alternatively be on the FCA register.”
Switcher scheme removed
The Sipp provider, which until recently had exclusively sold qualifying recognised overseas pensions (Qrops), also revealed that from 1 June it will scrap its Switcher Scheme offer for all Sipp transfers from other providers into its International Sipp.
The scheme waived set-up fees, first year admin costs and allowed ability to transfer into any other Momentum scheme, free of charge.
