Financial Services Compensation Scheme  

FSCS declares eight advice firms in default

FSCS declares eight advice firms in default

The Financial Services Compensation Scheme has declared eight advice firms in default alongside a troubled self-invested personal pension provider with almost 800 claims against it. 

In an update published today (March 27) the FSCS confirmed 15 firms had defaulted with the lifeboat body in February, with eight having operated in the financial advice sector. 

Included on the list was N.J. Associates, the advice firm linked to principal NJ Associates Financial Services Limited which the FSCS has already paid £28,000 against after it defaulted in January 24. 

The claims against the two advice firms, which share key personnel, involve self-invested personal pension complaints and those linked to mortgage endowments. 

Another advice firm in hot water over its mortgage endowment policies is Hector McLean Financial Consultants.

The FSCS told FTAdviser it has already paid a claim for more than £11,000 agains the firm, but the bill could potentially grow with another two claims currently being considered by the compensation scheme. 

Other advice firms featured on the list were Intuitive Financial Associates, Prime Mortgage Brokers, Totus Capital, Asset Independent Financial Advisors, WJR Wealth Management and Serenus Consulting. 

Troubled Sipp provider GPC Sipp was also declared in default by the FSCS last month, with the lifeboat scheme having received 799 claims for compensation against it. 

The lifeboat scheme has also assessed and paid out on claims against authorised IFAs in relation to advice they received to transfer their pension into a GPC Sipp.

The provider entered administration in June 2019 due to problems with the investments in its Sipps - several of which failed, such as Harlequin Properties, a £400m project involving a luxury hotel development that was largely never built.