Self-Invested Personal Pension (SIPP) Mis-Selling Claim
Nadeem Pervazis a solicitor at Edward & Amaury Solicitors, a law firm authorised and regulated by the Solicitors Regulation Authority. Content is reviewed for legal accuracy and compliance with FCA guidance and SRA conduct standards.
TL;DR — Quick Summary
- ▸A SIPP can be mis-sold if you were advised to move your pension into one without proper regard for suitability, risk, or the nature of the underlying investments.
- ▸Common mis-sold SIPP investments include overseas property, car parks, storage units, biofuel schemes, and other unregulated assets.
- ▸Both the financial adviser and the SIPP operator may be liable, depending on the circumstances.
- ▸If your pension is locked in illiquid investments you cannot access, you should seek advice immediately.
- ▸Time limits apply — generally three years from when you became aware of the problem, or six years from the original advice.
A self-invested personal pension (SIPP) can be a legitimate and flexible pension vehicle for the right investor. But SIPPs were widely mis-sold — often by unscrupulous introducers and inadequately regulated advisers — to people who had no business investing in high-risk, illiquid assets with their pension savings. If your SIPP has fallen in value, if you cannot access your pension, or if you were advised to move your pension into a SIPP without proper explanation of the risks, you may have a claim.
Quick Answer
If you were advised to invest your pension in a SIPP holding high-risk or illiquid investments — and you were not properly warned about those risks — you may have a SIPP mis-selling claim against your adviser, the SIPP operator, or both. The FCA and Financial Ombudsman have ruled in favour of claimants in many similar cases.
What Is SIPP Mis-Selling?
SIPP mis-selling occurs where a self-invested personal pension was recommended to you — or set up for you — in a way that was unsuitable. The FCA has identified SIPP mis-selling as a major regulatory concern, particularly in cases involving high-risk or unregulated investments introduced by third-party introducers.
Common scenarios include:
- You were cold-called or contacted unsolicited and persuaded to move your pension into a SIPP
- An unregulated introducer referred you to an FCA-authorised adviser or SIPP operator
- Your pension was invested in illiquid assets such as overseas property, storage units, or biofuel bonds
- You transferred from a defined benefit pension or workplace scheme into a SIPP investing in non-standard assets
- The risks of the investments were not clearly explained to you in writing
Types of High-Risk SIPP Investments
Many mis-sold SIPP cases involve investments that were either unregulated, illiquid, or both. Common examples include:
| Investment Type | Common Issues |
|---|---|
| Overseas hotel / resort developments | Often failed to complete; cannot be sold |
| Car park or storage unit bonds | Illiquid; many wound up; capital at risk |
| Biofuel / solar farm investments | High promised returns; many failed |
| Peer-to-peer lending schemes | Capital not protected; illiquid |
| Unregulated collective investment schemes (UCIS) | Illegal to market to most retail clients |
| Forestry / land banking schemes | Speculative; planning permission issues |
SIPP Operator Liability
It is not only the financial adviser who may be responsible. The Financial Ombudsman Service and the courts have held that SIPP operators — the firms that administer SIPPs — can also be liable where they failed to carry out adequate due diligence before accepting a high-risk investment into the SIPP. The relevant question is whether the operator should have known that the investment was not suitable to be held in a pension, and whether they acted appropriately.
This is an evolving area of law. If your SIPP operator accepted investments that were clearly high-risk or unregulated without carrying out appropriate checks, they may share responsibility for your loss.
Making a SIPP Mis-Selling Claim
- Identify the parties: Who gave you the advice to set up the SIPP? Who introduced you? Who is the SIPP operator? All may potentially be liable.
- Gather documents: Locate any suitability letters, SIPP application forms, and communications about the investment. If you do not have these, we can help you obtain them.
- Assess the loss: Calculate the difference between what you invested and what your SIPP is currently worth, taking into account any illiquid assets.
- Choose the right route: If any party is still trading, complain to them first and then to the Financial Ombudsman. If they have failed, apply to the FSCS.
Start your claim or contact us to discuss your SIPP mis-selling situation with a solicitor.