Provider Sipp Heritage Pensions Limited has gone into liquidation following four claims upheld by the Financial Ombudsman Service forcing it to pay a total of up to £600,000 in compensation to customers.
According to the Financial Conduct Authority, Heritage yesterday (March 17) sought professional insolvency advice following final decisions by the Fos.
Accordingly, the directors of the Bedfordshire-based company have appointed Paul David Williams and Edward Robert Bines of Kroll Advisory as joint liquidators.
The company’s liquidation follows the sale of Heritage’s Sipp book to Wiltshire-based PSG SIPP on 18 November 2021.
Heritage ceased to administer the personal pension plans when the sale closed, meaning customers who held a Heritage Sipp will not be affected by the liquidation.
PSG SIPP is a regulated Sipp operator, and while Heritage is in liquidation it remains authorized by the Financial Conduct Authority.
The regulator said in a statement today (March 18) that Heritage had sought professional insolvency advice following final rulings by the Fos earlier this year.
“Based on the insolvency notice, the directors of Heritage have recognized that the business is insolvent and have made the decision to put it into liquidation,” the FCA said.
“This was due to the company not being able to pay the reparations owed by Fos’ final decisions on the due diligence carried out by the company before undertaking certain investments in its Sipp.”
The Fos issued a total of six decisions relating to claims against Heritage Pensions Limited. Four of these decisions, published between January 11 and January 12, fell on the side of the plaintiffs.
The rulings forced Heritage to pay four clients up to £150,000 in compensation each, for a total of £600,000.
The four decisions relate to pension transfer advice given by TailorMade Independent Limited, a firm which the Fos said Heritage should have “refused to accept business”.
In 2013, the FCA restricted TMI’s licenses and it has since been dissolved. Heritage had an agreement in place with TMI that allowed TMI to advise its clients to use Heritage’s Sipp.
The four claims said Heritage ‘failed’ to exercise due diligence when accepting Sipps’ claims, saying it failed to perform proper checks on the adviser who recommended the transactions.
Two claims also stated that Heritage had not carried out checks on the investments to be held in Sipp, while the other two said that it had not carried out checks on the investment for which the Sipp was to be used.
The Fos currently has around forty open files against Heritage Pensions Limited.
Of the two historical claims, one was upheld in August 2020, while one issued in May 2013 was not.
The August 2020 decision saw the Fos ask Heritage to pay a client £1,000 for the ‘trouble and upheaval’ he caused by providing ‘incorrect information’ about the value of his Sipp fund.