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The firms are being asked to fill in a questionnaire and send the regulator copies of what it described as "relevant documentation".

A spokesman declined to elaborate on whether firms would also be subject to FSA visits.

He said: "We will probably carry out a more detailed assessment where we feel we might want to look into things further."

According to the FSA spokesman, the reason for the review of small Sipp providers is to assess whether they are adhering to its principles and rules, and to identify any issues that the FSA feel might require its "attention or intervention".

The spokesman added: "Other firms have a relationship manager, we know how they’re getting on as we have direct relationships with them.

"The smaller ones don’t have that, therefore were picking that up as part of the project."

Feedback on the review will be provided to the industry in the third quarter of 2009.

Earlier today (18 June), it was revealed that pension providers are pushing clients seeking income drawdown into Sipps, in a bid to bolster sales and profits. (See article.)