The Financial Ombudsman is set to release figures tomorrow showing a rise of approximately 50% in the number of Sipp complaints it has received in the past year, with growing concerns about Ucis.
In the 12 months to the end of March, the watchdog confirmed that it had received 1,036 complaints about Sipps, a 49% rise on the 697 received the previous year.
A report in the Sunday Times at the weekend revealed that most of the complaints - three out of four - were from savers who had been allowed to invest in unsuitable or unregulated schemes. The report confirms recent concerns about some Sipps being used to invest in Ucis, unregulated collective investment schemes which can be illiquid and complex.
According to the report, the Ombudsman has upheld 63% of the complaints. An Ombudsman spokesman said: " In almost two thirds (63%) of cases we are finding that the business has done something wrong and (we are) telling it to put things right for the consumer."
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The spokesman said that Sipps could potentially offer better returns than other pensions but came with great risks which had to be factored in.
Comment on the types of complaints received, the Ombudsman said: "We are currently seeing a steady increase in complaints about the advice to invest in unregulated funds and related Sipps (as well as Sipp-related scams). This accounted for almost 75% of all the Sipps cases we saw.
The spokesman added: "Some consumers are being advised to move their retirement savings into Sipps that invest wholly/partially in unregulated investments such as overseas property, forestry and film schemes on the promise of tax breaks and good returns. Consumers are then later finding out they have no access to or can't find the invested funds."