North Star SIPP LLP
Under investigation 02 August 2019
You might be eligible for compensation
North Star SIPP LLP (North Star) was dissolved on 9 June 2009. FSCS is accepting claims against this firm.
In January 2018, FSCS declared three Self-Invested Personal Pension (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.
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.
FSCS anticipates that claims submitted against North Star will relate to the SIPP operator's due diligence obligations in allowing customers to make specific investments under their pensions.
We're aware that North Star customers may have been advised by independent financial advisers to transfer existing pensions into a North Star SIPP. Following the pension transfer, customers had their pension funds placed in high risk, non-standard investments, many of which have become illiquid.
FSCS has already assessed and paid a number of claims made against IFAs already declared in default by us, in relation to advice customers received to transfer their pension into a North Star SIPP.
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30 Jul, 2019
To consider claims against a failed firm, FSCS must be satisfied that customers have first exhausted any right to claim against any connected firms that are still trading. FSCS understands that FCA authorised advisers may have recommended transfers of existing pensions or investments through a North Star SIPP.
If you were advised by an FCA authorised adviser that’s still trading to transfer your existing pension or to invest through a North Star SIPP, you need to complain to them before FSCS can consider your claim against North Star. If your adviser rejects your complaint, you can take your complaint to the Financial Ombudsman Service (FOS).
If you were advised by an FCA authorised adviser that’s now not trading to transfer your existing pension into or invest through a North Star SIPP, you should firstly submit a claim to FSCS against your financial adviser.
FSCS considers different factors when calculating losses on pension advice (a claim against your financial adviser) compared to SIPP investments (a claim against your SIPP provider). This means you may be eligible to receive more compensation for any losses by claiming against your financial advisor than if you just made a claim against your SIPP provider.
You can check to see whether your financial adviser has ever been authorised by FCA by visiting its website.
Although FSCS is accepting claims against North Star, claims will not immediately be passed to our claims processing teams for assessment. Firstly we need to establish whether there are protected claims against North Star. For this to happen we need to know that North Star owes a civil liability to customers that would enable them to sue the firm in court.
FSCS is working closely with the firm’s administrators and is investigating the practices of North Star, 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.