Avalon Investment Services Ltd

Under investigation 01 May 2018

FRN: 190602

You might be eligible for compensation

FSCS's position

Avalon Investment Services Ltd (Avalon) was placed into Special Administration in February 2016 and was later dissolved in August 2018. FSCS is accepting claims against this firm.

In January 2018 FSCS declared three SIPP operators, Brooklands Trustees Ltd, Stadia Trustees Ltd and Montpelier Pension Administration Services Ltd in default. Since then FSCS has received a number of claims against these and other SIPP operators, including Avalon.

SIPP operator due diligence has been an industry ‘hot topic’ in recent years and FSCS is aware that there are a number of pending civil claims in the High Court against various SIPP operators in respect of alleged due diligence failings.

Claims submitted to FSCS against Avalon relate to the SIPP operators’ due diligence obligations when accepting customers’ investments. Some Avalon customers were advised by authorised independent financial advisers (IFAs) to transfer existing pensions into the Avalon SIPP, while others were advised by unauthorised firms.

Following the pension transfer, customers had their pension funds placed in high risk, non-standard investments, many of which have now become illiquid. FSCS has already assessed and paid a number of customer complaints against authorised IFAs declared in default by FSCS, in relation to advice they received to transfer their pension into the Avalon SIPP.

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  • 18 Jul, 2019

    FSCS is continuing to look into the level of due diligence conducted by Avalon in allowing customers to make specific investments under their pensions.

    Our investigations are also focussing the due diligence carried out by Avalon on certain firms who introduced customers to Avalon. These investigations will allow FSCS to  determine whether protected claims exist against Avalon.

     

  • 31 May, 2019

    Although FSCS is accepting claims against Avalon Investment Services Ltd, claims have not yet been passed to our claims processing teams for assessment. Firstly, we need to establish whether there are protected claims against Avalon. For this to happen we need to know that Avalon owes a civil liability to customers that would enable them to sue the firm in court.

    FSCS is investigating the practices of Avalon, specifically seeking to establish what levels of due diligence were carried out by the firm, prior to permitting customers to make specific investments under their pensions.

    FSCS has been working closely with FCA and other firms to obtain documents that demonstrate the level of due diligence carried out by Avalon. We're also working with legal counsel so that we can determine whether protected claims exist. Once these investigations are complete we'll begin assessing claims.

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