FSCS investigates IFA over Sipp activity

FSCS investigates IFA over Sipp activity

The Financial Services Compensation Scheme is investigating claims against IFA Wellington Court Financial Services Ltd for its involvement with a self-invested personal pension provider.

In an update today (June 24), the FSCS said it has been working with the Financial Conduct Authority and the Financial Ombudsman service to investigate the activities of the firm.

Wellington Court was incorporated in Ireland and passported into the UK under the insurance distribution directive. It had a UK establishment in Devon which closed on December 31, 2021.

From December 19, 2016, Wellington Court had permission from the FCA to carry out certain regulated activities, including advising on investments and pension transfers. 

Prior to this date, it only had permission to carry out insurance mediation and insurance distribution activities.

However, the FSCS believes the IFA had involvement with failed Sipp provider Guinness Mahon Trust Corporation.

GMTC was declared in default by FSCS on October 29, 2020.

Last April, the FSCS paid out £22.5mn on 718 claims against embattled GMTC. At the time it said it had received 1,149 claims against the firm. 

The Fos has upheld a large number of complaints against Wellington Court in respect of its involvement with the transfer of customers’ pensions into a Sipp administered by GMTC.

However, where Wellington Court was involved in a customer’s transfer into the GMTC Sipp, FSCS has required customers to first exhaust their rights against Wellington Court via the Fos before FSCS is able to consider any claim against GMTC.

The FSCS said: “Wellington Court has failed to satisfy the Fos awards. The FCA has been notified of this failure.”

The FSCS told FTAdviser the claims so far relate to transfers into Sipps and it does not believe there is any crossover with the British Steel Pension Scheme. 

It is now considering whether valid claims exist under its rules in connection with Wellington Court’s activities.

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