Small self-invested personal pension (Sipp) providers could come under scrutiny from the Financial Services Authority (FSA) following implementation of the retail distribution review (RDR), an expert has claimed.
According to a report by the FT Adviser, James Hay’s head of product development, Chris Smeaton, believes the regulator may investigate small Sipp providers to ensure they are not mis-selling post-RDR, when their costs become more visible.
This suggestion is in the light of the FSA’s recommendation that Sipps should only be recommended to investors with a pot of more than £250,000, while those with smaller pots are encouraged to make alternative investments.
Mr Smeaton told the news provider: “There are some risks for smaller players, particularly those that have a ‘one size fits all’ offering.
“As there are so many small product providers out there, the FSA will have to figure out how to approach this.”
Meanwhile, City Wire reported that James Hay has waived its £180 fee for investors holding more than £180,000.
Posted by Tony Miller