- May 30, 2018
- Posted by: Money Redress
- Category: Press Releases
Hundreds of thousands of Brits who have invested hard-earned savings into underperforming pension schemes are being urged to check if they can reclaim huge portions of their lost money.
Countless savers who have lost financially from badly invested SIPPs – Self Invested Personal Pensions – could pocket a £50,000 windfall from a special government fund set up to compensate losers which is currently due to pay out a staggering £120 million.
Labour MP Frank Field has hit out at the SIPP conmen and vowed to bring the industry into line whilst industry experts reveal the true figure of mis-selling is growing at an unprecedented rate and the true loss of mis-selling will run into billions as the number of victims rocket.
A maximum £50,000 compensation is currently available from the £120 million fund managed by The Financial Service Compensation Scheme. But the figure is set to rise by 75 per cent to a £85,000 maximum next April to mirror the rapidly escalating number of losers throughout the UK.
The Financial Ombudsman however are allowed to raise their compensation ceiling and can award up to a further maximum of £150,000 for many cases.
The prevalence of SIPP mis-selling and the huge financial compensation tsunami which is expected to follow has drawn strong comparisons to the PPI phenomenon which has swept the country over the past few years.
Britain’s leading claims expert Rob Ridge from Money Redress said: “Raising the maximum award to £85,000 is good news for victims of mis-selling and yet nobody is aware of the true cost of what this scandal will put on the Financial Services Industry. We believe that the cost will be around £10bn which is 25 per cent of the PPI scandal. It’s huge.
“There are still thousands of people who don’t realise they’ve been mis-sold to, it’s crucial that they scrutinise their pension investments.”
The SIPP scams involved unscrupulous Financial Advisors preying on savers who were promised massive returns of up to 20 per cent a year only for their savings to be squandered on get rich quick schemes including investing in airport parking, holiday properties and green energy projects.
The Financial Conduct Authority revealed one in eight savers think an advisor has mis-sold them a financial product such a pension.
The FCA advise people who think they have been mis-sold a pension to raise a complaint as soon as possible as there are time-limits in place which could affect the outcome of your claim.
Their report called the Financial Lives Survey was widely praised by industry experts who believe that the government have underestimated the scale of mis-sold pensions such as SIPPs however the Commons Work and Pensions Committee have demanded tighter safeguards to protect savers.
Committee Chairman Frank Field MP said: “I am concerned about the role of SIPPs as platforms that help funnel unwitting clients’ pension savings into dodgy and inappropriate investments. SIPPs are happy to skim off their fee on the way but there are serious questions about their commitment to due diligence and consumer protection.
“When an unscrupulous financial adviser channels a victim’s money through a SIPP into an investment that then collapses, it is not enough for the SIPP provider to shrug their shoulders and say ‘caveat emptor’.
“I will be writing to the FCA to ask what they are doing to ensure SIPPS are not acting as handmaidens to the pension-snatchers.”
Mr Ridge, who has successfully represented scores of victims, added: “I couldn’t agree more with Mr Field. It’s really pleasing to know that he’s writing to the FCA to ask questions.
“We’re unearthing hundreds of clients a month who are finding themselves in this unfortunate position of being scammed by unscrupulous financial advisors.”
As seen in the Mirror