- Court of Appeal holds SIPP contract unenforceable under FSMA 2000, s 27 (Adams v Options UK Personal Pensions LLP)
- What are the practical implications of this case?
- What was the background?
- What did the court decide?
- The section 27 claim
- The COBS claim
- Case details
Pensions analysis: The Court of Appeal has partially allowed Russell Adams’ appeal in his claim for investment losses against Options UK Personal Pensions LLP (Options), formerly Carey Pensions, an authorised execution-only provider of self-invested personal pensions (SIPPs), while dismissing Mr Adams’ argument that Options was in breach of its duties under the Conduct of Business Sourcebook Rules (COBS) in the FCA Handbook. The court held that the contract between the parties was unenforceable under section 27 of the Financial Services and Markets Act 2000 (FSMA 2000), it having been entered into in consequence of arrangements made and advice given by an unauthorised third-party introducer in contravention of the general prohibition in FSMA 2000, s 19. Absent any further appeal, the decision represents a perhaps surprising conclusion to the long-running debate over the proper ambit of execution-only SIPP providers’ (and other financial services firms’) liability to their clients in such circumstances. Written by Henry Day, barrister, at Radcliffe Chambers.
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