Emma RadmoreThe latest in the current series of FCA portfolio supervision letters is aimed at the CEOs of SIPP operators. The FCA has recently completed its 2024 SIPP data request and will be using the information from it in its supervision.
Broadly, the concerns the FCA raised to the sector in May 2023 remain as it does not think firms have progressed enough to address the issues it raised, particularly in relation to redress payments to customers following due diligence failings. It is also becoming increasingly concerned about the handling of pension scheme money and assets and accuracy of books and records, and has also identified a number of particular concerns about Consumer Duty implementation. These include:
- that many firms do not understand that they are distributors as well as manufacturers;
- failure to specify the target market at a sufficiently granular level;
- assessment of fair value solely by making market comparisons;
- over-reliance on third parties; and
- failure properly to implement the Duty for closed products by the 31 July 2024 deadline.