Ray Chinn, head of pensions at LV, tells the Financial Conduct Authority to force providers to fully disclose the fees they charge for self-invested personal pensions or face regulatory action.
Mr Chinn said a lot of Sipp providers were being “slow” to disclose the fees they charge and it would “be nice” to see the FCA “flex it’s muscles on this area”.
When asked what action should the FCA take against Sipp providers who fail to reveal how much they charge Sipp clients for holding cash or selecting certain funds, Mr Chinn said thematic reviews and warning letters to chief executives would be a good start.
If providers failed to act on these warning letters, Mr Chinn said the FCA should then take action against the firms.
Mr Chinn said: “They need to follow through.”
He also revealed many advisers were currently considering switching their Sipp clients to new providers amid concerns about capital adequacy requirements.
As a result, Mr Chinn said LV was not considering purchasing struggling rivals Sipp books.
He said: “There is plenty of opportunity for organic growth. We do not need to buy books.
“Sometimes when you buy a book you end up not liking what you see.
“We reckon a lot of advisers with clients with Sipps with providers who look like they may struggle to meet capital adequacy requirements are already looking to move these clients elsewhere.”
Rather than see their client moved because the Sipp book has been sold, Mr Chinn reckons savvy advisers are reviewing where their Sipp clients’ business would now be best placed.
