The Financial Ombudsmen Service told The Sunday Times that it had dealt with 1,039 complaints about Self Invested Personal Pensions over the last 12 months, up from 697 the previous year.
The body said it upheld 63% of the complaints, of which almost three-quarters were from savers who had been persuaded to put their life savings into unsuitable and unregulated plans.
It added that many investors had lost tens of thousands of pounds from investing in risky assets aimed at sophisticated, rather than mass-market, investors.
Last month, the Financial Conduct Authority (FCA) issued a warning over unsuitable SIPP advice after an investigation into the conduct of financial advisers found “serious and ongoing” failings.
Despite investigating and warning of the improper transfer of pensions earlier this year, the regulatory body said some companies were continuing to give advice based entirely on the merits of the SIPP wrapper.
The warning said pension transfers should not be advised without considering “the customer’s existing pension arrangement and the underlying investments intended to be held within the SIPP”.
The FCA also imposed an industry ban on two financial advisers last month, after they lost nearly two thousand customers’ money by convincing them to invest in high risk, unregulated funds through their SIPPs.
It said Andrew Rees and Timothy Hughes, partners at 1 Stop Financial Services, were banned from “performing any significant influence function in relation to any regulated activity” and fined £490,100 for advising customers to switch £112m worth of pensions.
An increasing number of pension savers are falling victim to risky investments, with complaints about SIPPs jumping by nearly half over the last year.
In March last year, SIPPs became the subject of much controversy after the FCA wrote to providers asking whether they had any clients invested in Harlequin Property after in its Property Fund believed they were owed money they invested in its Buccament Bay Resort in Barbados.
It subsequently filed for administration in April.
