SIPPs pension transfers at risk, says FCA

MPs are urging the Financial Conduct Authority (FCA) to step up its oversight of the transfer of funds from defined benefit pension schemes to self invested personal pension (SIPPs) to stop abuse of the system after pension freedoms.

MPs want to see harsher penalties for advisers who provide poor advice resulting in the loss of pension pots due to risky pension transfers.

The amount of money transferred out of defined benefit pensions more than doubled last year to nearly £21bn, according to FCA figures.

There are widespread concerns that unscrupulous advisers are persuading people to move their protected funds from DB pensions into SIPPs plans which offer risky investment opportunities.