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AMPS urges regulators to tackle root of SIPP fraud
The Serious Fraud Office and Financial Services Authority should concentrate on stopping the promotion of unregulated investments to the general public, rather than increasing red tape for SIPP providers, the Association of Member-Directed Pension Schemes has said.
Responding to the SFO’s concerns that SIPP trustee companies are not regulated, by either the Pensions Regulator or the FSA, AMPS Chairman Andrew Roberts commented that “whilst bona fide SIPP operators would of course be able to accommodate regulation of their bare trustee companies, this would not stop fraud being committed within the investment fund which seems to be the real area of concern. The regulatory bodies should tackle the root of the problem and not seek to tarnish all SIPP providers because of failed investments, illegal promotion of UCIS or isolated instances of fraud.”
Roberts added that “The Government and the Opposition have pressed for pension charges to be controlled yet this is at odds with introducing more regulatory requirements. The industry is already faced with rising costs as a result of proposed changes to illustrations, better information flow to investors, higher FSCS levies from regulated investment fund collapses, improved due diligence of underlying investments and, of course, there is the expectation that providers will have to hold higher levels of capital reserves. At some point we should simply leave it to the SIPP operator to decide how to run their business and the consumer to choose whether they want a SIPP operator with higher charges and better controls or lower charges and fewer controls.”
AMPS is currently seeking views from its members as to whether they support regulation of SIPP trustee companies by the Pensions Regulator or the FSA.