Lifetime Sipp enters administration as scandal mounts

The British Pension system is under scrutiny following the collapse of another major pension provider.

As reported in the Telegraph, administrators have now been appointed to find a buyer for the Lifetime Sipp Company’s pension assets, and investors with funds at the firm have been urged to contact their financial advisers.

The Lifetime Sipp Company have sold 40% of their pension assets to Hartley Pension. The remaining 60% are so-called ‘bad assets’, which consist of largely worthless investment assets.

The Lifetime SIPP Company was a provider of self-invested personal pensions (Sipps), which allow for pension funds to be placed into a far wider range of assets than would be allowed through an employer operated scheme.

Due to the implementation of new measures designed to protect investors, in particular, reserve cash requirements against ‘non-standard’ assets, many firms in the sector have experienced difficulties in recent months with many, including Lifetime Sipp, now facing collapse.

Nearly two million people across the UK are thought to have invested into SIPPs. As the case of Lifetime Sipp demonstrates, this sector is highly volatile and has been the source of the majority of failures in the pensions market over recent years.

Many of the issues with SIPPs stem from the fact that they often consist of unusual and unregulated investments, such as storage pods. These are historic investments made in the years before the regulatory standards were improved. These investments are considered to be toxic assets, and many firms do not wish to take these on as a result.

In the majority of cases, where a Sipp provider has made a poor investment decision, the provider will seek to argue that the responsibility should lie with advisers or with the investor. However, the upcoming High Court case concerning Carey Pensions may determine this issue.

As explained by John Moret, an expert in Sipps, if the court finds that Carey was responsible despite the fact that it didn’t offer advice, “that could really open the floodgates” to an increased volume of claims.

How can we help?

If you think you may have a claim in relation to Lifetime Sipp or another Sipp provider and would like us to look into the matter for you, please get in touch.

You can fill in our simple online enquiry form and one of our expert advisors will call you back to discuss your matter in more detail. Alternatively, you can call us on 01204 328 287 and we will be more than happy to discuss your queries.