Describing it as a “low margin product”, Davies explained the company has decided to withdraw the offer due to greater capital adequacy rules introduced by the FCA in September 2016.
He said it takes “huge amount of time” to investigate Sipp transfers and classify assets as standard or non-standard.
“We just don’t feel it’s feasible to do it at no cost,” said Davies.
New FCA rules
Under the new system all Sipp providers must hold minimum capital of £20,000 ($28,400, €25,200) and are also required to set aside further funds, known as a capital surcharge, depending on the volume of non-standard assets.
The move is designed to increase due diligence and liability for providers accepting riskier non-standard assets.
In July 2016, the UK’s Financial Services Compensation Scheme (FSCS) revealed that payouts to UK consumers, aggrieved by poor life and pensions advice, have more than doubled due to an increase in high risk unregulated Sipp investment claims.
