Following a recent development and the failure of two major firms that provide pension advisory, support, and investment; CPPT services Ltd and Lifetime SIPP, these two, among a handful of other similar firms are generally referred to as self-invested personal pension companies. They are charged with the responsibility of managing and advising customers on high-risk investments.
More than 650 claims are currently being processed by the Financial Services Compensation Scheme (FSCS). Over 75% of these claims have been made against Lifetime SIPP while the remaining 25% of such claims have been made against CPPT services. The FSCS categorised most of these claims under pension advisory, pension transfer, and SIPPs. It also pointed out the fact that the Claims Processing Department is about to commence detailed assessments of already submitted claims. It is estimated that FSCS may be required to pay more than £3.500,000 for just Lifetime SIPP related claims alone. This would make up more than half of the amount to be paid for these claims. Over 500 claims have already been made against Lifetime SIPP, they have already made a payment of £85,000 for one of the claims, no claims under Lifetime SIPP has been rejected for now.
Lifetime SIPP, in 2018 made proactive attempts to salvage the situation by paying for the services of Kingston Smith and Partners. Unfortunately, the situation had become unsalvageable, after more than one year of active participation and support from Kingston Smith, Lifetime SIPP on the 2nd of April 2019 finally went into liquidation. Back in January, Lifetime SIPP had begun the process of transferring over 40% of all the SIPPs it was at the time managing, to Hartley Pensions. Hartley Pensions prior to the transfer had signed an agreement giving it the legal rights to acquire certain assets that belonged to Lifetime SIPP.
Hartley Pensions secured the approval to operate as a pension fund manager in collaboration with Wilton Group in 2016. Claims from former CPPT customers, on the other hand, are estimated to be worth at least £1,000,000. They have been in a company voluntary arrangement since 2017, and FSCS says that 159 claims out of the total 162 CPPT claims that have already been made are in the final stages of processing. Currently, under the claims levied against CPPT, no claims have been paid, 3 claims have been rejected, 159 claims are still being processed and a total of 162 claims were made. In conclusion, as at 31 July 2019, the FSCS had already received 662 claims from former CPPT services Ltd and Lifetime SIPP customers. FSCS which is an independently run organisation but accountable to the Financial Conduct Authority (FCA) continues to assure its commitment to protect the interest of consumers and provide stability in the financial sector.