Hartley Pensions Sipp holders could see the transfer out process kick started in April after months of waiting.
According to an update from administrators UHY Hacker Young, the first lot of Sipps will be transferred to a different Sipp operator from this month.
It said the funding received from the Financial Services Compensation Scheme has allowed Hartley to administer the transfer out process without the need to charge clients an exit and administration charge.
But it said these transfers would have to be done over the course of a few months due to the volume of Sipps.
For example, some Sipps will start their transfer process this month while others will have to wait until June.
UHY Hacker Young said: “Due to the difference between the nature of clients’ assets held within their Sipps and the different contractual relations for each Sipp scheme, the joint administrators have grouped categories of clients into tranches to streamline the transfer out process.
“The options given to each client with regards to the transfer out process will depend on the tranche that each client falls into.”
It clarified it also would not be able to do transfers out on an ad hoc basis at the request of an individual client.
The administrators will send transfer documents to clients as follows:
The documents include a letter to set out people’s options as well as a client asset statement (a breakdown of the assets held within the Sipp); a response form (to be filled out if the client does not agree with the asset statement); a transfer out form (providing details as to which operator the clients wants to transfer to); and a pension liberation leaflet.
After these documents are completed and returned, UHY Hacker Young will update on the process and timescales for transferring out of the Sipp.
In February, the FSCS provided funding to allow Hartley Pensions’ administrators to implement an exit strategy and start transfers out for thousands of customers.
The lifeboat scheme paid this funding into a trust account which will be used by the administrators, meaning Sipp members will not be charged the exit and administration charge that was originally proposed.
The FSCS declared Hartley Pensions in default so it was able to pay out the compensation.
While the company is in default so compensation on the exit charges can be paid, the FSCS has not opened or received individual claims against Hartley Pensions.
FSCS U-turn
At the beginning of the year, the FSCS U-turned on its previous decision and said it would protect Hartley Sipp members by paying compensation for the exit and administration charge.
In December, as reported by FT Adviser, the FSCS said it did not have enough evidence and said the EAC would not be protected under its rules, but it U-turned on this decision.
The EAC is intended to cover costs, including the costs for customers to transfer to other regulated companies where possible, until Hartley’s administration is concluded.
FT Adviser reported in December that this charge could amount to as much as £37mn. The administrators have said this would be to cover work arranging transfers out for the 16,741 Sipp schemes.
Hartley Pensions entered administration at the request of the Financial Conduct Authority back in July 2022.
amy.austin@ft.com
