Not even the FSA themselves would try and kid anyone that they are thought of warmly by those that they regulate, but what about the all important distinctions between the collective personality of a large institution and the people that work for it?  Don’t lose sight of the fact that the people coming to see you are not genetically engineered automatons, but people with a job to do who would sooner work with you than against you.

Friday 25th November 2011 was a significant day for PSG SIPP Limited.  A year after becoming authorised and regulated by the FSA, we had a visit from their CASS Unit.  How did we do?  In truth we can’t yet know for sure, but let’s just say they left with smiles on their faces that weren’t just to do with it being the end of a hard week for them, or the lunch we provided.  We were pretty happy bunnies too.

We’ve all heard the adage ‘if you fail to plan, you plan to fail’ and whilst that slightly smug sounding nugget of wisdom is (hopefully) used with a certain sense of irony these days, it still rings true.

Regardless of whether you are a Provider, or an Adviser, or both, when you receive your notification from the FSA that they would like to pop over for a chat, how you react right there and then will go a long way to determining the outcome of the visit itself.

It’s no good running around like headless chickens and it certainly isn’t an option to just sit there assuming everything is already in place and wait for the door bell to go.

We immediately formed a small Project Committee to identify:

• how long we had to prepare;
• what our priorities were in this timeframe;
• who was going to do what;
• how it was all going to be monitored.

We were heartened by the fact that much of what the CASS unit were likely to be interested in was already well established as well as being more than adequate when measured against their criteria.  However, what we chose to do was to think about how we would prepare for a full and intrusive FSA audit.

This involved us going back to all of our processes and procedures to review them and satisfy ourselves that they were fit for purpose, particularly with regards to Treating Customers Fairly and Handling Client Money.

We also reviewed our Systems and Controls, our MI, our staff training policy, our Auditing and Monitoring, our Whistle Blowing policy, our staff appraisal systems etc, etc.  You get the idea.

You see, it’s not just about having all of these things and more besides in place and knowing that you designed them to work for your firm and for the FSA.  It’s about reconnecting with all of these things to be certain they are up to date and to regain that familiarity with them so that everyone that should, can talk about them in detail, with confidence and without a script to follow. 

In addition, we prepared a short presentation that we hoped the CASS Unit would allow us to use to give the day a start point.  We knew they’d have certain questions as starters for ten, why not help them by pre-empting some of these and proactively provide answers?  As well as making life easier for all, it demonstrates how seriously you take their visit, but also how confident you are in your understanding of what is required of you and your ability and inclination to deliver it.

One final but very important point to note though; this is not like preparing for an exam which is something that an individual must do on their own.  How your organisation performs on the day will be down to how well you prepared as a team.  Without cooperation from all areas, not just ‘key staff’ your preparation will never be as good, your performance will be well under par and you will have lost that opportunity to build your team without the aid of a lake, a raft to construct and an expensive day out of the office.
 

As you may have noticed, the design and build of a website isn’t exactly something that we rushed into.  However, before you go accusing us of plain old tardiness on this important front, I should point out that we didn’t spend those relatively low profile years twiddling our thumbs and ignoring the fact that having no web presence would potentially become a bit of an embarrassment one day.

If I may massively oversimplify a point here, what we do is provide and administer pension schemes.  Whilst we are doing so, what we always keep in mind is that our clients don’t; they are busy doing what they do.  It might sound simple, but what I’m alluding to here is that there’s just too much of a tendency, across all industries, to assume levels of knowledge that it’s unreasonable to expect anyone outside that industry to have.

What the Dickens has this got to do with our website you may ask?  Well, it’s all about understanding what you need and then choosing your expert wisely.  After all, we are always educating people that putting independent expertise ahead of a simple cost-based criterion is the best way to proceed, so it would have been hypocritical of us to rush into a website based on nothing more than the cheapest quote when we didn’t understand what we wanted our website to do and perhaps just as importantly, what we didn’t want it to do.

We also noticed how many websites simply shout about ‘what’ that company does, which isn’t very helpful in choosing one service provider over another.  Surely it’s ‘how’ you go about it that makes a service appealing.  Any one company from a huge pool of website designers could have built our site but we needed someone who could add the ‘how’ and ‘why’ around the ‘what’.

Financial Services providers in particular seem to be guilty of defaulting to ‘template’ websites, where all they’re doing is putting their logo and colour palette into a vast website full of generic content. But PSG doesn’t ‘do’ generic and we don’t just brand our own version of template pensions either.

What you see here is the result of building a relationship with the right kind of experts; experts who understand that their reputation is irrevocably linked to how satisfied their clients are from the first meeting, to the completion of the project.  It’s how we work and how we like our Professional Partners to work.

This website reflects PSG’s personality but is no mere marketing gimmick designed to exploit an obvious gap in the market.  Sure, we did the homework and looked at how everyone else presented themselves, but we didn’t decide to look totally different for the sake of it.  A big part of our message is that we are problem solvers.  Yes, you can have your pension scheme, whipped off the shelf and lovingly gift wrapped; no problem at all.  We’ll see to it that you get value for money and service that’s second to none.  However, what we really pride ourselves on is our natural desire to look beyond the obvious and to work with Professional Advisors to create something that fits around the individual rather than force the individual into a product-shaped hole.

Ever looked at a website for a company that comes under the banner of Financial Services and wondered at the sheer mediocrity of the thing?  We did.  I lost count of how many photos we came across of smug retired couples walking their terrier on the beach, or suited execs shaking hands, or Canary Wharf or even, yes, just bundles of cash.  Let’s be honest, it’s nigh on impossible to use stock imagery to effectively communicate what you are all about without ending up with a website that just looks like everyone else’s.

So we approached the design and build of our website with exactly the same mindset that we are always helping advisers to adopt when approaching a review of their clients’ financial situations. By this I mean that we came up with a brief of what we really wanted to achieve and then passed the whole thing onto our chosen expert to let them think around it.  After all, why consult an expert if you are going to ignore them?

Finally, most of us would agree that websites, as interactive as they can be and as essential as they are these days, are still just shop windows to the business.  We can’t fit all our wares into our window which means that there are loads more things inside that you really ought to look at.  Enjoy the site but don’t forget to give us a call if you want to know more.    

If you provide a service that makes promises and then delivers on them, you too will understand the importance of relationships. Check out the promises we’re proud to be able to make.      
 

The current heightened profile of esoteric investments is probably attributable to a number of things though, but before we get onto that, what are they?  There is no definitive list and even if there were, there’d be little point in paying too much attention to it as it’d change on a daily basis.  However, put simply, esoteric investments could be defined as pretty much anything that is slightly out of the ordinary and/or requires expert knowledge on the part of the Provider and Adviser before it should be considered by a Client.

Hotel Rooms, Copyrights, Prisons, stakes in care homes, Carbon Trading and even good old fashioned Overseas Property could all be regarded as esoteric.  There are plenty more besides these and whilst we at PSG are all about making things happen for Advisers and their clients, we always urge people to proceed with extreme caution and we can help any interested parties reach their own fully informed opinion on whether they should proceed, as well as whether they can.
 

In simple terms, here at PSG we allow access to any investment that does not attract HMRC tax charges under Post A-Day regulations and legislation.  However, as is likely to be something of a recurring theme over the next few years (when is it not one?); nothing is ever that simple.

 
We will always do our best to render things as easy to understand as possible, but some things need more careful pulling apart than others and this is never more true than where esoteric investments are concerned.  Due to increasing numbers of esoteric investments popping up in SSASs and SIPPs, various regulatory bodies are shuffling things about in a bid to gain more control of them.

If we take Hotel Rooms as our specific example again, these are increasingly being categorised as esoteric by the FSA and by HMRC and in fact the FSA often go even further and deem them to be Unauthorised Collective Investment Schemes (UCIS).  This is an attempt to bring what are otherwise unregulated investments, inside the regulatory framework and therefore within the FSA’s jurisdiction, with all the regulatory implications that UCIS entails.
 

On that basis, it is fair to say that like PSG, all providers are (or should be) being very careful before accepting investments of this nature. As any SIPP provider will tell you, providers are now also expected to critically assess the suitability of the SIPP before accepting a new client.  This suitability test, though typically ill defined by the regulator, must include scrutiny of the proposed investment(s). 
 

We readily accept that the FSA are seeking to force SIPP Operators to become involved in and encroach on, an area that is in fact the responsibility of the IFA who is, of course, authorised by the FSA in any case and clearly better qualified than a provider to give advice (which legally the provider cannot usually do anyway). 
 

Ignoring the changes to the regulatory landscape is not an option. However, if you wish to remain truly client focused, neither is assuming that such investment options are now closed off or soon will be.
 

Our approach to this issue is the same one we use for everything; we will work with advisers from across all areas of the industry to establish a process which allows us to carry out our investment due diligence but does not place any unnecessary barriers in the way of interesting and potentially high yield transactions.
 

We believe the key to always being on the right side of prevailing legislation whilst looking for reasons to do something, rather than reasons not to, lies in building relationships based on mutual understanding and pragmatism.

© Duncan Parsons, PSG, 02/12/11
 

However, plenty of water has passed under the bridge since then but far from SIPPs popularity waning, the market place has become a bafflingly enormous retail park with the appearance of more choice than you could take advantage of if you lived a thousand lifetimes.  Well, we can’t all be Dorian Gray and let’s face it, you’d need the world’s biggest pension pot and the cleverest advice to fund immortality.  Not even we can help you there.

So, how do you choose? How do advisers advise?  Sometimes it seems as though there are more SIPPs and SIPP providers out there than people to have one.  Well now, this is something we may be able to help with.

We are always comforted by the fact that we are not authorised to provide advice.  Life can be tricky enough as a provider without the added stress of keeping abreast of what everyone is up to so that considered and well informed advice can be offered to the general public, sophisticated investors or not.  However, what we know is that this apparent embarrassment of riches is not so dissimilar to the world of supermarkets.  It is an illusion of choice whilst actually offering you very little indeed and too little of it bestowed with any real quality.

We always knew that our first SIPP, on gaining authorisation, had to be one that would fit with our SSAS business and our general ethos and that’s tempting to refer to as ‘true’ or ‘full’.  Leaving such marketing monikers aside for the moment, in essence, it had to be a SIPP that allowed for the maximum possible control for the client with the minimum possible restrictions on investments.

This is what our Aspire SIPP was from day one and always will be.  We took a look at what most people were offering, even at the ‘bespoke’ end of things and then shoved our flag in the ground a bit further on and a bit higher up from there.  There’s your boundary at one end of the SIPP world.  Now, we might argue (and we’d not be alone) that this is surely what SIPPs are supposed to look like and that anything short of this is not a SIPP, it’s a Personal Pension run by a Life Office that wants to get into the SIPP market but is too big to run the product properly (such cynicism).  This might be true all too often, but certainly doesn’t have to be the case.

This brings us to the other boundary, the one at the base camp of the SIPP mountain (if you will).  Don’t get us wrong, the popularity of SIPPs is great and has given the tired old pensions world a much needed shot in the arm.  The fact remains though that a huge number of the ‘SIPPs’ on offer, fall a long way short of offering what can be offered and what many in the industry would argue should be offered by SSAS’s cocky younger sibling.

So, when you already have a SIPP out there that is proud to offer full and uncompromised flexibility, control and investment options, where do you go when launching a new one to run alongside it?

Its catalyst, as with so many of the things we come to do, wasn’t the most obvious or conventional start to the design of a new product.  Born out a belief that a SIPP could be rendered cost effective for clients whilst facilitating very specific investment transactions not available to personal pensions and still benefitting from PSG’s client focused portfolio administration, we discovered that we’d come up with the perfect second place on the podium to the Aspire SIPP; the PSG Advantage SIPP.

This is no cynical attempt to occupy some middle ground and mop up in the areas that the better Life Offices or bigger providers are operating in, nor is it representative of the SIPPs on offer at base camp.  The PSG Advantage SIPP provides first class service and access to myriad investment options and the ability to upgrade to an Aspire SIPP at any point, but with a charging structure to rival other products that will only prove to be considerably blander when tasted.

If you want silver service with your SIPP and everything that means to us; speed, consideration, accuracy, integrity etc but you have no desire to use your SIPP to invest in property, have a look at our Advantage SIPP; it might make a lot of sense.