FCA Consults on Consistent SIPP Standards

The Financial Conduct Authority has set out proposals to drive greater consistency of standards across the self-invested personal pension (SIPP) market, introducing clearer due-diligence requirements and stronger rules for handling pension-scheme money and assets while preserving the flexibility and broad investment choice that define the product. Published on 22 June 2026 as consultation paper CP26/20, the proposals follow the regulator's findings of historical weaknesses among some operators, and the consultation closes on 24 August 2026.

The FCA was careful to frame the intervention as a tightening of standards rather than a wholesale criticism of the sector. It said most SIPP providers are already doing the right thing and providing a good service, but that it has historically found cases of poor due diligence, weak record-keeping and gaps in how firms protect customer money and assets. The two central proposals address those failings directly: a clear set of due-diligence standards intended to improve the consistency and adequacy of checks across all SIPP operators, and stronger requirements for the handling of pension-scheme money and assets, designed to reduce the risk of consumer harm when a firm fails or winds down.

The focus on what happens when a firm fails reflects hard experience in the sector. SIPPs allow consumers to hold a wide range of investments within a tax-advantaged pension wrapper, and average SIPP pot sizes tend to be higher than those of other personal pensions, meaning the harm to an individual when something goes wrong can be substantial. The market is large and systemically relevant to UK retirement saving — industry estimates put it at more than six million investors holding over £630 billion, a meaningful share of total UK pension assets — and its history includes high-profile operator failures, most prominently the 2022 administration of Hartley Pensions, which affected more than 16,000 investors, many of whom faced prolonged difficulty accessing their funds. Strengthening the rules on how client money and assets are safeguarded is the FCA's response to exactly that pattern.

Charlotte Clark, the FCA's director of cross-cutting policy and strategy, framed the proposals around consumer confidence, saying SIPPs give consumers flexibility and choice and that, while many firms are doing the right thing, the regulator wants to help people invest with greater confidence by ensuring standards are consistent. The FCA also positioned the package as complementing the Consumer Duty by making explicit what good practice looks like, rather than introducing an entirely separate regime.

The proposals carry clear operational consequences for the firms that run these schemes. SIPP operators would face a more prescriptive and consistent due-diligence framework, removing some of the discretion that has produced uneven standards across the market, alongside enhanced obligations on safeguarding client money and assets that will require investment in systems, controls and record-keeping. Smaller operators, where the FCA has previously identified weaker controls and thinner resources, are likely to feel the greatest impact, and the direction of travel points to a market in which the cost of meeting regulatory expectations continues to rise.

How the consultation is received before the 24 August deadline will shape the final rules, but the trajectory is set: the FCA is moving to codify consistent minimum standards in a market it has long regarded as uneven. The proposals are likely to reinforce a gradual consolidation among SIPP operators, as firms unable or unwilling to meet the higher bar exit or are absorbed by larger, better-resourced providers. For the wider pensions sector, the consultation signals continued regulatory attention on the protection of customer assets in non-mainstream pension products, a priority that the run of operator failures over the past decade has made difficult to set aside.