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Is my Sipp safe with Merchant Investors?

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Merchant Investors is a Bristol based company best known for underwriting high net worth life assurance and pension products. Initially part of Allianz (UK), Merchant Investors (also known as MI Group) was purchased by a South African investment company called Sanlam in 2003/2004.

Sanlam purchased the company for less than £50 million. At the time, Merchant Investors had approximately £1.1 billion under management. This was held between around 120,000 customers.

SIPP Product

Merchant Investors was considered a very niche pension provider/SIPP administrator. However, it was well-established in the UK market. In the early years, Merchant offered an insurance-based SIPP. The product allowed customers flexibility and freedom to plan and save for retirement.

Merchant Investors was a little different from other SIPP administrators. Instead of an annual charge, there was an initial administration fee with potential additional costs.

Lowering the Threshold

In 2007 Merchant Investors slashed the minimum investment levels required to attract new customers to its SIPP, halving requirements from £50,000 to £25,000. The minimum value of commercial property included in the SIPP was also scrapped having previously been set at £200,000. The SIPP had access to Merchant Investors’ revamped Pinnacle range of over 70 funds.

In January 2008, Merchant Investors launched a SIPP called ‘OneSIPP’, this combined its insurance SIPP with a trust-based SIPP’s investment scope. This form of SIPP was supposed to give customers greater asset protection than in a trust-based SIPP.

Insured vs Trustee-based SIPPs

Insured SIPPs benefited from a compensation scheme covering 90% of the insured assets, whereas trustee-based SIPPs offered compensation only on the first £48,000 of invested assets.

OneSIPP allowed customers to keep many of the assets held in a traditional trust-based SIPP in the insured part of OneSIPP. Investment choices include equities and bonds, commercial property and hedge funds. OneSIPP customers also had the option of investing only in Merchant Investors’ Pinnacle fund range.

To attract new clients Merchant Investors waived all transfer and top-up charges on its SIPP in late 2008. This included the £75 transfer charge for all new and existing transfer applications to its OneSIPP. It also waived the £50 top-up charge for existing clients.

Merchant Investors and Sanlam

The company continued to operate as Merchant Investors for several years. This was until April 2011 when it was rebranded to Sanlam Investments and Pensions.

Does or did Merchant Investors act as administrator for your SIPP, has your money been invested in risky and unregulated schemes, have you lost money? If so contact Anthony Philip James Solicitors, our team of financial mis-selling experts, may be able to recover compensation for any loss suffered.