Avalon SIPP – Embark

SIPP (Self-Invested Personal Pension) mis-selling has turned into an alarming issue, hitting a growing number of individuals adversely. SIPPs, while offering a broader investment liberty than standard pensions, come with increased financial risks – and occasionally, advisory firms and SIPP providers neglect to adequately spell out these risks.

Avalon SIPPs and Multicorp Rose are glaring instances of mis-selling. If you’ve been sold an underperforming Avalon pension product, you may have grounds for a compensation claim. Let’s delve deeper into this:

Avalon’s Rocky Journey

  • Avalon supplied SIPPs to clients, which were channelled into high-risk investments such as HJ Commercial Plc, HJ Residential Plc, HJ SME Plc, and Ukrainian Property Fund. When some of these investments tanked, it left customers nursing severe losses.
  • Avalon hit a bump in 2016 when it collapsed, following a £2 million claim by Michael Bennett against the firm for fees paid for arranging non-existent consortium investments.
  • The tide turned when Embark Group (owners of Hornbuckle, another SIPP provider) stepped in to buy Avalon, expressing faith in the team. They continued to offer Avalon’s Freedom SIPP product, cleverly avoiding further claims by purchasing only the firm’s assets and not its equity.
  • Despite Embark’s rescue act, Avalon was dissolved in 2018 amidst rising complaints about its investment practices. By 2019, the Financial Services Compensation Scheme (FSCS) reported several claims against Avalon, with the firm under investigation for its due diligence and responsibility towards customers’ funds.
  • By January 2020, Avalon was declared ‘in default’, opening the door for affected ex-clients to seek compensation.

The Role of Multicorp Rose

  • Advisory firm Multicorp Rose (associated with Pensions Calculator) advised clients to opt for Avalon SIPPs as a sound pension choice. They had a questionable past for using unauthorised ‘pension introducer firms’ to gain clients, which put them under the Financial Conduct Authority (FCA) radar.
  • Multicorp Rose, like Avalon, also collapsed following complaints.

What’s Next?

  • The FSCS has already dealt with over 200 complaints about Avalon SIPPs and paid out £264,000 in compensation. More claims are expected in the future.

If you’re a former Avalon customer, you could have a strong case for compensation. Reach out to our team today via our contact page for further assistance.

In a Nutshell:

SIPP Providers: