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The Financial Services Compensation Scheme has warned that retirees are being tempted to put money into investment products claiming to offer high returns due to the prolonged low interest savings environment.

The Financial Services Compensation Scheme (FSCS) declared 11 firms in default in March, including several wealth managers and a firm involved in BSPS transers.

Liberty SIPP has been declared in default, after being placed into administration on 27 April 2020.

The FSCS warned today that its levy for the coming year will soar by a third to over £1bn with SIPPs and “complex” pensions cases behind a big chunk of the rise.

FSCS chief executive Caroline Rainbird has revealed that the major factors pushing up the FSCS levy have been the surge in claims against Self-Invested Personal Pension (SIPP) operators and a rising trend of pensions-related claims.

The Financial Services Compensation Scheme has declared 45 firms in default between May and October including two signifcant SIPP providers and dozens of financial advice firms. 

The FSCS is working through nearly 1,000 potential claims against SIPP operator Guinness Mahon which collapsed in February.

he Financial Services Compensation Scheme has paid out just over £38.1m in compensation to LCF customers, a substantial increase from the £20m paid out by August when the body increased the team allocated to the case by nearly 80%.

The Financial Conduct Authority, the Financial Services Compensation Scheme and the Financial Ombudsman Service have warned Financial Planners to take action on any SIPP or SSAS investments in the German Property Group.

The Financial Services Compensation Scheme received 4,100 extra SIPP and pensions claims 2019/20 than it expected, resulting in increased cost of £3.9m.

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