A director at Mattioli Woods has confirmed his firm is holding talks with troubled Sipp providers and the FCA to look at possible solutions ahead of the revamped capital adequacy rules taking effect next year.
Mark Smith said the company has been in discussions with the regulator on a regular basis ever since it dealt with the troubled Freedom Sipp.
He said: “We are currently in discussions with Sipp providers on how we could assist them considering all of the options that are potentially available.”
He said the discussions were on-going and that continues to be part of Mattioli’s strategy.
Mr Smith said as a listed business it cannot be disclosed but how many Sipp operators Mattioli is having discussions with as this is price sensitive information.
But he said: “I can confirm that we have on-going discussions with Sipp operators who are considering their options and that is part of our on-going strategy.”

{desktop}{/desktop}{mobile}{/mobile}

Asked what the likely timeframe for any developments arising from these discussions might be and what the options are if these progress, he said: “We will consider potential acquisitions where appropriate and also consider assisting troubled Sipp operators if we believe we are able to do so. These discussions can include assisting existing providers with the wind up of their Sipp arrangements."
Mr Smith explained why the company has become involved.
He said: “The key issue is the potential tax liabilities that can flow through from one HMRC registered scheme administrator to another. The Sipp provider has, in effect, dual authorisation. HMRC regulates the firm as the formal scheme administratorr and the FCA regulates the firm to establish, operate and wind up personal pensions including Sipps.
“If a firm looks to be appointed to a Sipp it takes on the scheme administrator obligations. If there were any historic tax liabilities that were or could have been levied against the scheme administrator than HMRC has the power to pass these on to the new scheme administrator.”
If the FCA wants to take enforcement action it can be difficult to find a replacement scheme administrator to take on a scheme if there are potential tax issues that could flow through, he explained.
He said: “For example, enforcement action was taken against HD Sipp to stop them from operating the scheme but we were not appointed to assist until almost 18 months later. In the meantime, no work whatsoever could be undertaken on behalf of clients who were ‘trapped’ in the scheme.”