Hartley administrators propose four cost models for Sipp clients

In an update to Sipp clients administrators UHY Hacker Young said each of the proposed cost models offered different ways of calculating the charge.

UHY Hacker Young previously told investors it would apply to court to ratify an ‘exit and administration’ charge that the administrators will make against the assets that clients hold within their Sipps.

This will replace the current annual management fees that Sipp clients are being charged and will enable them to eventually transfer out.

We now anticipate that the transfer out process is likely to commence from September 2023 onwards.UHY Hacker Young

The letter stated: “This charge will be a single one-off fee in respect of the continued cost of administering your Sipp and it will also cover the cost of transferring Sipp clients onto new operators.”

The four proposed cost models are:

1. Fixed fee per client model – This model is a fixed fee for all clients regardless of the type(s) of asset held or value of their Sipps. 
2. Hybrid charge based on asset type model – This model is a different charge for each type of asset held within a client's Sipp.
3. Percentage based model on the total value of the assets under administration model – This model will charge a percentage on the value of the assets in a client's Sipp; and 
4. Capped percentage charge – This model will charge a percentage on the value of the assets within a client's Sipp subject to a cap to be determined. 

The application to court will seek confirmation that the administrators have the ability to impose the charge and seeks the power to impose the charge.

Transfers out

The letter said UHY Hacker Young has been in contact with the FSCS to see whether clients could be compensated for the charge.

It stated: “FSCS remain engaged with us. We now anticipate that the transfer out process is likely to commence from September 2023 onwards. 

“Please note, it may take 12 months or longer from this date to effect all transfers to new operators. This timescale may vary if we are able to identify one or more nominated operator(s) as it is expected that a nominated operator would be able to on-board Sipps more quickly than if each and every Hartley client were to be transferred individually.”

FTAdviser previously reported in April, that clients may have to wait up to a year to get their Sipp assets after some clients struggled to draw down their funds.

One pensioner couple, Mr and Mrs Potts, who are advised by Julian Pruggmayer of Financial Risk Management, told FTAdviser in April they had been trying to get their money transferred, to no avail.

At the time, Hacker Young said part of the administration process was to reconcile all the assets that Hartley administers on behalf of clients - approximately £1.2bn - to make sure the assets are securely held by the trustee companies. 

In an update, UHY Hacker Young told FTAdviser earlier this month: "The reconciliation process is still ongoing but we are hopeful to have this concluded within the next few months. 

"We are also in the process of finalising an application to court to have ratified an exit and administration charge to clients in order to facilitate the transfer out of the clients Sipps to a new provider."

Those who are battling to get their money from Hartley Pensions' administrators have since invited advisers and clients to join an action group.

One client, Mr S, who was originally a Berkeley Burke self-invested personal pension customer before it went into administration in September 2019 and its Sipp book was sold to Hartley Pensions, said he felt he had been "fighting alone" for his money back.

amy.austin@ft.com