The parent company of Options, formerly known as Carey Pensions, is looking into whether it needs to set aside cash after the Court of Appeal sided with a client in his case against the SIPP provider this month.
In an announcement published this morning (April 16) STM Group said it had delayed its 2020 year end results to early May following conversations with its auditors Deloitte.
According to STM, the delay is due to the ruling in relation to the Adams v Carey case published earlier this month (April 1).
STM said: “A significant exercise is being carried out to determine whether the ruling has triggered an event which would require a provision, as defined by accounting standards, to be included in the Company's financial statements and, if so, requires audit testing to be carried out.”
The company added that the inclusion of any such amount set aside was not expected to have any impact on its net asset figure or the results of the business, due to the claim being covered by the group's insurance policy and indemnities.
The group is expecting to report 2020 revenues of £24m, EBITDA of £3.6m, PBT of £2m and net cash of £15.5m.
In the Court of Appeal’s decision this month judges overturned a previous High Court ruling and sided with the claimant, who had lost money after investing in high risk unregulated investment Store First via his Sipp.
The judges found claimant Russell Adams had been advised, in contravention of the Financial Services and Markets Act 2000, by CLP Brokers, an unregulated introducer.
The court said at no time was CLP authorised by the Financial Conduct Authority to give investment advice, or to make arrangements relating to investments.
The court declared that, because the Sipp was entered into as a consequence of CLP’s actions, the Sipp agreement is unenforceable against Adams, and he is therefore entitled to ‘unwind’ it and recover the money he paid into it, as well as compensation to reflect the losses he has suffered as a consequence.
Last week the Financial Ombudsman Service said it had 592 open complaints against Options UK Personal Pensions, formerly known as Carey Pensions.
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