The Financial Services Compensation Scheme has paid out £58.8mn on claims it has received against failed provider Berkeley Burke Sipp Administration.
The lifeboat scheme has told FTAdviser it has received a total of 2,155 claims against Berkeley Burke Sipp Administration, of which 1,795 have been upheld, 309 have been rejected and 51 are still in progress, as of January 11.
BBSA failed and was placed into administration on 18 September 2019 after it could no longer afford to defend redress claims made against it.
Immediately after being appointed, administrators RSM announced that the Sipp arm of the business would be sold out of administration in a pre-pack deal with Hartley Pensions.
But in March the Financial Conduct Authority told Hartley it could no longer accept new clients and the company entered administration shortly after.
BBSA went into administration because it was unable to cover the financial costs of defending claims made against it in respect of the firm's alleged due diligence failings when accepting high risk investments between 2010 and 2012.
On its website, the FSCS said it was aware that IFAs recommended many BBSA customers to transfer their existing pensions into a Berkeley Burke Sipp.
After the transfer, customers had their pension funds placed in high-risk, non-standard investments. Some of these have since become illiquid, which means they cannot currently be sold or traded.
According to a liquidator’s statement, published on Companies House in September 2022, about 4,000 clients may have suffered losses on their investments.
It also noted that the Hartley administration should not require additional work as part of Berkeley Burke’s administration.
In August 2020, STM Group acquired 100 per cent of the share capital of Berkeley Burke (Financial Services) Ltd and Berkeley Burke Employee Benefit Consultants Ltd, which provide administration and consultancy services to small, self-administered schemes and international businesses.
These two businesses are independent of the Berkeley Burke Sipp business.
amy.austin@ft.com
