FSCS opens to claims against SIPP operator Berkeley Burke SIPP Administration Ltd
The Financial Services Compensation Scheme (FSCS) has announced that it is open to claims against Berkeley Burke SIPP Administration Limited (BBSAL). The SIPP (self-invested personal pension) operator went into administration yesterday.
FSCS is working closely with the firm’s administrators RSM and is investigating the practices of BBSAL. FSCS is seeking specifically to establish what levels of due diligence were carried out by the firm, prior to permitting customers to make specific investments under their pensions.
Although FSCS is accepting claims against BBSAL, claims will not immediately be passed to our claims processing teams for assessment. Firstly, we need to establish whether there are protected claims against BBSAL. For this to happen we need to be clear that BBSAL owes a civil liability to customers.
We're aware that many BBSAL customers were advised by independent financial advisers (IFAs) to transfer existing pensions into a BBSAL SIPP. Following the pension transfer, customers had their pension funds placed in high-risk, non-standard investments, many of which have become illiquid.
FSCS has already assessed and paid a number of claims made against IFAs already declared in default by us, in relation to advice customers received to transfer their pension into a BBSAL SIPP.
All customers who think they may have a claim related to BBSAL should in the first instance visit the BBSAL webpage on the FSCS website at https://www.fscs.org.uk/failed-firms/berkeley-burke/even if a claim has been made against an adviser already.
In January 2018, FSCS declared three SIPP operators, Brooklands Trustees Ltd, Stadia Trustees Ltd and Montpelier Pension Administration Services Ltd in default. Since then FSCS has paid claims against these and other SIPP operators.
Media contacts:
Anthony Ozimic t: 020 7375 8638
James Tweed t: 020 7375 8646
Catherine Goodier t: 020 7375 8631
Notes for editors
About FSCS
FSCS is the UK's statutory compensation scheme that protects customers of authorised financial services firms that carry out certain regulated activities. FSCS protects deposits, investment business, home finance (mortgage) advice, life and general insurance, insurance broking and debt management.
FSCS can pay compensation if an authorised firm is unable to pay back money it owes its customers in connection with a regulated activity. The Scheme was set up by Parliament in 2001 and is funded by the financial services industry.
Declaring a firm in default
Before FSCS can pay compensation, it must be satisfied that a firm does not have sufficient assets to meet claims. It describes this as being ‘in default’. The Scheme will declare a firm in default if:
- it has received at least one claim; and
- it is satisfied that the financial services firm that has failed is unable to return money to eligible claimants itself.
FSCS is required to do this before it can pay compensation to eligible claimants.
Declaring a firm in default allows private individuals who have suffered actual financial loss as a result of their dealings with that firm to apply to the Scheme. Some businesses and charities may also be eligible, depending on the type of claim.
Authorised firms
Dealing with a Financial Conduct Authority (FCA) or Prudential Regulation Authority (PRA) authorised firm that is carrying out certain authorised activities gives consumers access to the Financial Ombudsman Service (FOS) and FSCS. Consumers can check that the firm they are dealing with is authorised by using the FCA’s Financial Services Register.
Broadcast media
An ISDN line is available if you are interested in arranging a radio interview with an FSCS spokesperson. Please get in touch with our public relations team publicrelations@fscs.org.uk to arrange a suitable time and date.