FCA Tightens SIPP Rules as Charlotte Clark Pushes for Due Diligence Overhaul

Britain’s pension watchdog wants stricter rules for self-invested personal pensions. The Financial Conduct Authority laid out plans to force SIPP providers into clearer due diligence requirements — and the industry has until August 24 to push back.

The FCA’s core complaint is pretty blunt: some SIPP operators aren’t doing enough. The regulator spotted shortcomings across due diligence, record keeping, and asset protection at certain providers. Not minor gaps, either — the kind of failures that leave consumers exposed when a firm hits trouble or quietly exits the market. So the FCA wants uniform standards that every SIPP operator has to meet, full stop. Charlotte Clark of the FCA spoke to the significance of these changes, pointing to their role in supporting consumer investment choices. No vague aspirations there — the FCA is basically saying the current patchwork isn’t working and the industry needs to get in line.

What the FCA Actually Wants Changed

The proposals zero in on three problem areas. Due diligence is the big one — providers need to know what assets they’re accepting into a SIPP and why. Record keeping is the second pressure point, because when a firm fails, regulators and consumers need a clear paper trail to recover assets. And asset protection itself is the third leg: pension scheme money has to be handled in a way that shields it from whatever financial mess a provider might find itself in.

And that last part matters a lot. SIPPs hold long-term retirement savings. When a provider winds down badly, consumers don’t just face inconvenience — they can lose money they spent decades building. The FCA’s proposals are specifically designed to cut that risk. Clearer handling rules mean less ambiguity about where pension assets sit and who’s responsible for them if things go sideways.

The proposals also tie directly into the Consumer Duty framework, which the FCA rolled out to set a baseline for what “good practice” actually looks like across financial services. By anchoring the new SIPP standards to Consumer Duty, the regulator is trying to make the expectations concrete rather than conceptual. Providers won’t be able to claim they didn’t know what the bar was.

A Market That’s Been Inconsistent for Too Long

SIPPs have always been a bit of an outlier in the pension world. They’re flexible — that’s the whole point. Consumers can hold a wider range of investments than a standard workplace pension allows. But that flexibility has a downside: it’s attracted providers with varying levels of rigor, and the quality gap has been obvious for years. Some operators run tight ships. Others, apparently, don’t keep records the way they should.

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The FCA wants to close that gap without killing what makes SIPPs useful. The stated goal is consistency and adequacy, not a crackdown on the product itself. That’s a fine line to walk, and it’s probably why the regulator published a consultation paper rather than just dropping new rules. It needs industry input to make sure the standards it sets are actually workable.

The consultation is open now. Stakeholders — that means providers, advisers, consumer groups, anyone with skin in the game — can submit feedback before August 24. The FCA framed it as a genuine dialogue, not a rubber stamp. A discussion paper is also out, meant to give the industry a platform to flag practical concerns before the rules get locked in.

Where This Fits in the FCA’s Broader Pension Push

It’s worth noting that SIPP reform doesn’t exist in isolation here. The FCA has published Pensions Regulatory Priorities, and the SIPP proposals sit squarely within that framework. The regulator is clearly trying to modernize the whole long-term savings landscape, not just patch individual problems. SIPP standards are one piece of that, but the direction of travel is toward a pension market that’s more resilient and more transparent across the board.

Whether that ambition survives contact with industry feedback is unclear. Providers will probably push on the specifics — what exactly counts as adequate due diligence, how detailed records need to be, what asset protection looks like in practice. Those details matter enormously for compliance costs, and smaller SIPP operators may struggle more than the big players.

But the FCA seems committed. Clark’s comments weren’t hedged. The regulator sees a problem, it’s named the problem publicly, and it’s set a deadline for responses.

August 24.