Guinness Mahon – Hartley Pensions

Guinness Mahon Trust Corporation Limited (GMTC), a SIPP provider, went into administration in February 2020. This was due to many complaints about how they handled investments.

What went wrong

  • Many investments were high-risk and non-standard
  • Customers lost significant money as a result
  • The Financial Services Compensation Scheme (FSCS) declared GMTC in default
  • This allowed customers to claim compensation

Issues with advisers and due diligence

  • Many GMTC customers were advised by unregulated advisors
  • These advisors told customers to transfer pensions to GMTC SIPPs
  • The money was then put into unsuitable, risky investments
  • Some investments are now illiquid and untradeable
  • There are concerns GMTC didn’t properly check these investments
  • Customers may not have been told about all the risks

Compensation from the FSCS

  • Affected customers can claim up to £85,000 in compensation
  • The FSCS has paid out £22.5 million for over 700 GMTC claims so far
  • Around 250 claims are still being processed
  • There were about 4000 Guinness Mahon SIPPs when the firm collapsed

Summary:

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