A Claims Management Company
Total amount invested
Why did people invest in it?
The firm included a high proportion of non-standard investments in their portfolios, offering high returns on investment.
Why was it mis-selling?
In 2013, Wells was found to have had inadequate understanding of the risks of MPAS SIPPs, and had failed to conduct due diligence to mitigate for risks incurred by clients.
Potential value of cases
Between February 2009 and May 2011, Montpelier Pension Administration Services Limited was led by Kevin Wells, who served as managing director. He oversaw a major expansion of the company and its SIPPs business, often featuring non-standard investments. These tended to promise very high returns in comparison to traditional investments. The proportion of investments that included some non-standard portion increased massively over this period.
During a routine visit in October 2010, the FCA discovered a range of failings at the firm. This prompted a wider investigation, which led to Wells being removed from his post as director. He was fined a significant sum, and was officially censured for overseeing a number of failings in the business.
These failings included the fact that Wells had not identified or mitigated the risks involved in holding non-standard investments within SIPPs; that he had expanded rapidly despite this lack of identification or mitigation of these risks; and that he had allowed the expansion of the firm at a high speed despite lacking the appropriate capital resources.
These combined to leave Montpelier Pensions’ clients open to a very significant level of risk, and also exposed the firm to an unacceptable degree of risk. The FCA also discovered that Wells had failed to understand, or to attempt to understand, the compliance and capital needs, meaning that his provisions for both were highly lacking.
The FCA ultimately stated that “Wells’ tenure as managing director should be seen as a ‘how-not-to’ guide of running a SIPP operator - he was out of his depth.” By October 2011, the firm sold its business book to another provider, Curtis Banks, and voluntarily cancelled their FCA authorisation. Notably, however, Curtis Banks did not acquire any liabilities when they purchased the MPAS client book and other assets, meaning that if MPAS proceeded to fail, then the burden would fall on the FSCS.
In January 2018, the FSCS declared the firm to be in default, and has footed the bill for further mis-selling claims against MPAS.
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