As I am getting older, I don’t know if my tolerance levels are lower than they once were but at the moment, every time I read a story about the number of SIPP complaints being received by The Financial Services Compensation Scheme and Pensions Ombudsman it makes my blood boil.

These reports are so misleading, and I don’t blame the journalists, it is the sensational way that these data points are being communicated.

If you look at the data, the claims are more often than not due to the investment advice on what is being held in the SIPP or the product advice – where a SIPP was not the most appropriate tax wrapper to use. This is nothing to do with the SIPP itself which is a highly flexible and relevant product for today’s market.

Now I am not trying to shirk any responsibility here, I do agree that the SIPP operator should have a certain level of care and due diligence surrounding the investments held within the SIPP product. But, when Chancellor Nigel Lawson introduced the concept of a SIPP back in 1989, the concept idea was for them to be ‘self-invested’, with the SIPP operator checking that the investments complied with HM Revenue & Customs (HMRC) rules and that holding the investment within the SIPP did not cause a tax charge on it. This was all fairly easy as we had a permitted investment list to work to and things were relatively clear.

In 2007, things changed when SIPPs became regulated, by 2011 the Financial Conduct Authority (FCA) believed that SIPP operators should be undertaking deep dive due diligence on the investments being accepted, but without any real details.

These due diligence changes have led to many SIPP operators exiting the esoteric investment market and limiting the choice and freedom that SIPP investors have for their investments. Now in part this is a good thing, as there have been unscrupulous sales people that have persuaded – very successfully – SIPP investors to invest in things that have had little value or they are unable to sell, sometimes because they don’t exist – such as overseas property.

The SIPP investors that were defrauded out of their hard earned money, have tried to claim from the investment provider and unregulated adviser, but often they have declared themselves bankrupt and so have no other route but to claim against the SIPP operator.

While I have sympathy with those who have lost money through scam investments, much of the responsibility should be on the SIPP investor themselves, as they are using a self invested product and needed to undertake their own due diligence and unfortunately, when the investments fail, they cannot expect the SIPP operator to make this good, unless they shouldn’t have accepted it at all.

So please can we all stop talking about SIPP complaints and badge them correctly as unscrupulous unregulated advisers and scam investment complaints. This will be better for the industry and help SIPP investors and other consumers more aware of the issues.

Elaine Turtle, Director, DP Pensions