The FCA has published CP26/20: Adapting our rules for a changing market: Self-Invested Personal Pensions (SIPPs), setting out proposals to strengthen consumer protection whilst supporting the continued growth of the UK’s SIPP market. The consultation reflects the significant evolution of the sector over recent years, with SIPP assets now exceeding £567 billion across approximately 5.3 million consumers. Although the FCA acknowledges that the majority of SIPP operators maintain robust standards, it has identified inconsistencies across the market, particularly in relation to due diligence and the safeguarding of pension assets. The proposals seek to establish a clearer and more consistent regulatory framework without removing the flexibility that SIPPs offer consumers.
What is changing?
The consultation focuses on two principal areas.
- Stronger due diligence requirements
The FCA proposes introducing clearer and more consistent expectations for SIPP operators when assessing investments and third-party arrangements. The objective is to reduce the risk of consumers being exposed to scams, fraud and unsuitable investment opportunities through inadequate due diligence processes.
The regulator expects firms to adopt proportionate, risk-based procedures that demonstrate:
- appropriate assessment of investments accepted into SIPPs;
- robust governance over higher-risk or non-standard assets;
- effective oversight of introducers and third parties; and
- clear evidence that due diligence has been undertaken and documented.
These proposals are intended to create greater consistency across the market and complement firms’ existing obligations under the Consumer Duty.
- New Pension Scheme Money and Assets regime
The second proposal introduces a dedicated Pension Scheme Money and Assets (PSM&A) regime where SIPP operators utilise unauthorised trustees.
The FCA has identified gaps in the current framework governing how pension scheme money and assets are protected, recorded and administered in these structures. The proposed regime would introduce clearer requirements covering:
- protection and segregation of pension scheme money;
- accurate ownership records;
- reconciliation and record-keeping;
- governance over pension assets; and
- arrangements to protect consumers if a firm fails or enters insolvency.
The proposals are designed to strengthen operational resilience and improve the protection of pension assets throughout the product lifecycle.
Who will be affected?
Whilst aimed primarily at SIPP operators, the consultation has wider implications for firms involved in the pensions ecosystem, including:
- personal pension providers;
- investment platform operators;
- discretionary investment managers;
- stockbrokers;
- third-party custodians;
- trustees of defined contribution pension schemes;
- auditors;
- insolvency practitioners; and
- firms providing services to SIPP operators.
What should firms be doing now?
Although the proposals remain under consultation, firms should begin considering how the new requirements could affect their existing governance and control frameworks.
In particular, firms may wish to:
- review due diligence procedures for investments and third-party relationships;
- assess governance arrangements surrounding higher-risk investments;
- evaluate existing controls for safeguarding pension scheme money and assets;
- review record-keeping and reconciliation processes; and
- identify any operational changes that may be required should the proposals be finalised.
Early consideration will place firms in a stronger position to implement any new requirements efficiently once the FCA publishes its final rules.
Consultation timetable
The consultation opened on 22 June 2026 and closes on 24 August 2026. Following consideration of industry feedback, the FCA intends to publish a Policy Statement setting out the final rules.
How Complyport can help?
- Regulatory Gap Analysis: We can assess your existing SIPP governance, due diligence and operational framework against the FCA’s proposed requirements, identifying any gaps and providing practical recommendations to help you prepare for the final rules.
- Governance and Control Reviews: Our specialists can review your governance arrangements, investment due diligence processes and oversight of third-party relationships to ensure they align with the FCA’s increasing expectations around risk management and consumer protection.
- Policy and Implementation Support: Where changes are required, we can assist with updating policies, procedures and internal controls, helping your firm implement the new requirements efficiently whilst maintaining a robust and proportionate compliance framework.
Contact Us
To discuss how the FCA’s proposals may impact your business, speak to one of our experts.
Alternatively, explore our Virtual Compliance Assistant: https://vica.chat
