In its annual report and accounts published today (June 17) the life-boat fund confirmed it paid out an additional £68m to 425,760 customers in 2018-19, compared with the £405m paid in compensation the previous year.
The scheme said it had "worked hard and with empathy" to handle the claims of customers and in doing so had "helped restore confidence" in the financial services industry.
The volume of Sipp related claims continued on its upward trajectory with the FSCS paying £123m in compensation in the last financial year, £11m higher than the £112m paid in 2017-18.
These often involved investments which were high risk and unsuitable for most investors, according to the FSCS, which led to some inevitable failing and becoming illiquid, in a trend of rising claims the scheme said began four years ago.
These claims were part of the £157m paid for claims in the life and pensions intermediation class last year, a figure the FSCS said necessitated a supplementary levy of £78m which was funded by the retail pool.
Caroline Rainbird, chief executive of the FSCS, said: "As we continue to see a rise in Sipp related claims we are working with our partners in industry through our 'prevent pillar' to gain valuable insight into the causes of firm failures and about the directors and advisors involved in mis-selling."
The FSCS also pointed to the growing number of Sipp and pension claims as attributing towards the scheme's increase management expenses, which totalled £74.2m in 2018/19 at an annual increase of 7 per cent.
The life-boat fund also warned it had experienced a rising number of cyber attacks in its infrastructure, which required additional costs to be spent on its cyber security and the establishment of a security operations centre.
The FSCS continued to see a "significant" number of investment intermediation claims in 2018/19, paying £49m in relation to "negligent" advice to invest in unsuitable pooled investments - although this figure was lower than the £129m seen the previous year.
The scheme said this drop was principally due to a £50m provision in 2017/18 for the return of assets and cash to customers of Beaufort Asset Clearing Services, which was placed in administration by UK regulators in March 2018 shortly after the US Department of Justice brought criminal charges against the company for its alleged involvement in securities fraud and money laundering.
