Did you transfer a pension with Brooklands Trustees?
If you were advised to transfer any sort of pension into a SIPP with Brooklands Trustees, you may be a victim of faulty pension transfer advice. SIPPs, generally speaking are not for the faint-hearted investor. More, they are designed for experienced investors who don’t mind paying fees that are typically much higher than normal pension holding arrangements, have an appetite for risk AND a capacity for loss.
If you had no previous investment experience and/or a low attitude to risk, you shouldn’t have found yourself with a Brooklands SIPP.
Established in March 2006, Brooklands Trustees lapsed into administration in July 2016 by which time the Brooklands SIPP had 5,500 members from all over the world and funds under management of £650 million. A pre-pack arrangement realised £425,000 and saw their SIPP book sold to Heritage Pensions.
So where did it all go spectacularly wrong? Well, Brooklands policy was to only accept business from advisers who held an introducer agreement with them. Sadly, on occasion, they failed to check if introducers were actually regulated. One such business was FCP Insurance Consultants who were signed up in 2009 and, incredibly, had no authorisation from the UK Regulator to provide pension advice. Their favoured destination for SIPP funds was the LMMP fund (LM Managed Performance fund) – an Australian Property Fund which paid a tidy 9% up-front commission.
It was a classic case of the horse already having bolted from the stable when it dawned on Brooklands that FCP Insurance Consultants weren’t actually authorised. Undaunted, FCP then simply agreed a ‘piggyback’ deal in late 2012 with UK-regulated firm Universal Wealth Management (who were dissolved via compulsory strike-off in December 2018) allowing them the route to continue introducing even more deals. Extensively sold to expats all over the world, the LMMP fund finally collapsed in spectacular style in 2013, with investors told they were likely to receive no more than 5p for every £1 previously invested.
The whole sorry tale and the failure to apply basic due diligence on an unregulated introducer saw Brooklands enter administration following 20 claims totalling £1.6m being upheld against them by the Financial Ombudsman Service (FOS). Finally, in January 2018, Brooklands, along with Stadia Trustees Limited and Montpelier Pension Administration Services Limited, were declared to be in default by the Financial Services Compensation Scheme (FSCS). The FSCS reported combined claims for all three being in the region of 150, with significantly more claims expected through 2018/19.