The lawyers are seeking redress for clients who lost money after having their pension funds placed in high-risk investments by Liberty Sipp, some of which have now become illiquid.
APJ believes all its claims are applicable and will be meeting the FSCS's claims criteria. Investments included the likes of the failed Ethical Forestry Scheme.
According to APJ, the clients' average transfer value from an occupational pension into a Liberty Sipp was £150,000 and therefore a significant number will be entitled to receive the maximum compensation available from the FSCS of £85,000.
Glyn Taylor, solicitor at APJ Solicitors, said: “It’s been a long journey for the 1000’s of Liberty Sipp clients affected and APJ Solicitors has been seeking redress for more than 850 clients, who have had their financial security hanging in the balance for far too long.
“It’s likely that many clients will have lost more than £85,000, and as a leading firm dedicated to achieving justice for our clients who have been affected by the wrongdoings in the Sipp industry we will be exploring all avenues including Liberty Sipp’s professional liability insurance with the aim of securing maximum redress.”
The FSCS to date has received fewer than ten claims against Liberty Sipp, which fell into administration last week (April 27) after the provider lost its battle against mounting claims.
However, it is expected that the number of claims will be significantly higher as more begin to meet the criteria set by the FSCS.
To consider claims against a failed firm, the lifeboat scheme must be satisfied that customers have first exhausted any right to claim against any connected firms that are still trading.
FTAdviser understands that FCA-authorised advisers may have recommended transfers of pensions or investments through a Liberty Sipp.
Therefore these clients will have to first complain to the adviser before their claims can be considered by the FSCS.
Although claims against Liberty Sipp are already being accepted, they will only be passed to the FSCS’s claims processing teams for assessment once it has been established that Liberty Sipp owes a civil liability to customers that would enable them to sue the firm in court.
The lifeboat scheme said: “The FSCS is working closely with the firm’s administrators and is investigating the practices of Liberty Sipp, specifically seeking to establish what levels of due diligence were carried out by the firm, before allowing customers to make specific investments under their pensions.”
The Liberty Sipp Limited business and customer assets were sold to EBS Pensions Limited, part of the Embark Group, in October 2018, which then rebranded the Liberty Sipp as the Option Sipp.
However, the legal entity Liberty Sipp Limited was not part of the sale and retained its liabilities. It consequently had to pay out against any complaints using the assets it held.
In August 2018, it was reported the Fos had received just over 500 complaints about Liberty from clients who had allegedly lost money after making high risk investments.
amy.austin@ft.com
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