Is this letter sent to SIPP providers the beginning of the end?

Is this letter sent to SIPP providers the beginning of the end?

Financial Conduct Authority chief executive, Andrew Bailey, issued a ‘Dear CEO’ letter in response to a judgment against troubled SIPP provider, Berkeley Burke

In the letter, Bailey advised SIPP providers to consider whether they can afford to pay out for any potential compensation claims. He warned the firms about any pending civil claims in the High Court regarding SIPP due diligence obligations.

The letter came on the same day that SIPP provider, Berkeley Burke, lost a key legal appeal. The firm were disputing the claim that it was responsible for failing to perform the required due diligence when accepting unregulated investments in 2014.

Justice Jacobs, however, ruled in favour of the Financial Ombudsman Service, finding that the FOS had followed Financial Conduct Authority guidelines when making its decisions.

Andrew Bailey’s letter was a stark warning to firms who may find themselves in a similar situation to Berkeley Burke very soon. He stated:

Pending the outcome of any appeal of today's judgement and these other cases, we expect you to consider the potential implications of them for your firm and its customers.

If the outcome of any of these cases calls into question your firm's ability both now and in the future to meet its financial commitments as they fall due, you must notify the FCA immediately.

Where relevant, firms should also notify claims to their professional indemnity insurers in accordance with their policies

The letter also stated that the FCA understands that if a firm may not be able to meet its financial commitments in the wake of potential compensation claims, it may be in the some clients’ best interests for part or all of its business to be sold.

How can Smooth Law Commercial help?

Smooth Commercial Law are one of the forerunners in holding negligent SIPP providers to account. We are currently acting for c. 30 of the cases against Berkeley Burke, within a fresh group action which has seen 164 fresh claims.

Our team of experts have extensive experience in dealing with a whole manner of claims that arise from negligent and/or unsuitable financial advice. We are seeing more and more mis-sold SIPP claims, and have managed to secure compensation for many of our clients.

Should you have a claim, we can deal with your case and look to recover compensation for not just your loss of investment but also any adverse tax liabilities that you may now be facing as well.

You can contact our experienced team by calling the number at the top of this page or by emailing

The contents of this article are intended for general information purposes only and shall not be deemed to be, or constitute legal advice. We cannot accept responsibility for any loss as a result of acts or omissions taken in respect of this article.