Financial Ombudsman Service  

Sipp complaints to Fos show no signs of abating

Sipp complaints to Fos show no signs of abating

The number of complaints about self-invested personal pensions received by the Financial Ombudsman Service looks set to continue growing.

In the first two quarters of the year, the Fos received 1,754 new cases about Sipps, with 777 in the second quarter of the year making them the 13th most complained-about product.

If complaints about Sipps continue at their current rate during 2018/19 they will exceed the total registered last year, which was 2,051.

On top of this the proportion of complaints being upheld has increased, from 52 per cent during the whole of 2017/18 to 61 per cent so far this year.

FTAdviser reported yesterday (6 November) that about 1,000 Sipp complaints received this calendar year related to the way the providers carry out due diligence on the underlying investment before accepting business.

The Financial Services Compensation Scheme has also seen increasing demand because of Sipps, with the amount paid out in compensation during 2017/18 going up by 7 per cent to £112m.

Payment protection insurance continued to be the product which generated the most complaints to the Fos, with 43,326 new cases in the second quarter alone, accounting for 44 per cent of all complaints.

Last year the Financial Conduct Authority started the clock on a two-year countdown to the deadline for making a complaint about PPI.

Payday loan complaints were in a distant second place, with just 14,578 complaints in the second quarter followed by current accounts, with 7,731.

The Fos received a total of 182,819 enquiries and 98,346 new complaints – with 11,371 complaints passed to an ombudsman for a final decision.

During the last quarter the Fos received around 1,000 more enquiries and 800 more complaints about current accounts than in the previous quarter. The uphold rate for these complaints also increased from 34 per cent to 60 per cent, which has been attributed to recent problems with banking IT systems.

Perhaps the most high profile incident of banking IT problems this year was at TSB, when almost two million customers were unable to access their bank accounts after the bank began moving its customer data from a system controlled by its former owner, Lloyds Banking Group, to a new system built by its new owner, the Spanish banking group Banco Sabadell.