There is an article in the FT about the woes of those with the failed Hartley Pensions group. The good news is that after complaints from SIPP holders the FSCS has once again agreed to cover the administrators costs the bad news is that after 18 months this is still dragging on.
https://archive.is/2024.02.10-065224/https://www.ft.com/content/3e4bbd98-7d99-4dce-93eb-2c747aad1ce5Retirement savers ensnared in the protracted wind-up of the failed Hartley Pensions group say they are being driven to the “edge of despair” as uncertainty lingers over the future of their nest eggs.
Jonathan Booth, 64, from Hertfordshire, is one of around 17,000 customers of the Bristol-based Hartley Pensions who have been unable for 18 months to transfer their funds — totalling about £1.3bn — to other providers after the self-invested personal pension (Sipp) company was placed into administration.
Fruitless attempts to find a buyer for the stricken business, and ongoing efforts by the administrator to reconcile the various pension books acquired by Hartley over the years, have led to delays.
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The strains of the administration on Booth and other Hartley customers was exacerbated by the administrator imposing a transfer ban.
There was a further setback for trapped customers when the administrator sought court approval to replace annual management fees with an “exit and administration charge (EAC)” designed to cover its costs, which it initially estimated at around £40mn, or 2-3 per cent of total assets.
For Booth, this meant a £4,000 knock to his pension. “This was a further blow,” he said. “It came out of the blue”.
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After pressure from Sipp holders’ lawyers, the Financial Services Compensation Scheme, the safety net for customers of failed firms, confirmed it would step in to cover the administrator’s charges, now estimated at around £31mn.
However, lawyers said this did not fully resolve matters for embattled Hartley customers.
“The statement made by the FSCS does not provide all the detail at this stage,” said Gareth Fatchett, solicitor at FS Legal, which is acting for Hartley customers. Many people faced wider losses after being in limbo for 18 months, he added.
Former pensions minister Baroness Ros Altmann said Sipp investors needed better protections. “The costs of administration of failed pension firms, which are uncontrolled, need to be handled differently, as it could become a licence to charge money without adequate scrutiny,” she said.
While the immediate need was to resolve the issues facing customers, said Ross of Which? Money, “there will rightly be a time for asking serious questions about the actions of the regulator and administrators in this case”.
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A Treasury spokesperson said: “The FSCS announced last week that they will provide compensation for customers of Hartley Pensions to fund the movement of customers away from Hartley to other Sipp providers.”