Educational, not advice. Savvy Investor Guide is not regulated by the Financial Conduct Authority and we are not financial advisers. Nothing on this site is personal financial advice. This article explains a regulatory proposal; it does not tell you what to do with your pension or which SIPP provider to use.
What this article covers: what the FCA’s June 2026 consultation paper CP26/20 proposes for self-invested personal pension (SIPP) operators, why the regulator is acting now, the timeline, and what the changes would mean for ordinary DIY pension investors.
What it does not cover: which SIPP provider to choose, how to invest inside a SIPP, or whether a SIPP is right for you. For the wrapper comparison, see our ISA vs SIPP guide.
A self-invested personal pension puts you in the driving seat. Instead of a provider choosing your investments, you decide what your pension holds, whether that is index funds, individual shares, investment trusts, or commercial property. That freedom is why SIPPs have grown into one of the largest parts of the UK retirement market: around 5.3 million consumers hold roughly 567 billion pounds in them, according to the FCA’s 2024 data.
On 22 June 2026 the Financial Conduct Authority published consultation paper CP26/20, “Adapting our rules for a changing market: self-invested personal pensions.” It proposes two significant changes to how SIPP operators must behave: tighter checks on the firms and introducers that feed business into SIPPs, and a new regime to protect your money and assets if a SIPP operator fails. The regulator’s core argument is that weak processes at some operators have left consumers exposed to scams, fraud, and the fallout of provider collapses. This article explains what is proposed, why, and what it could mean for you.
In short
- The market: about 5.3 million consumers and roughly 567 billion pounds sit in SIPPs.
- Change one: SIPP operators would face mandatory due-diligence standards, initial and ongoing, on the third parties that introduce members or facilitate investments.
- Change two: a new Pension Scheme Money and Assets (PSM&A) regime would protect client money and assets that currently fall outside the FCA’s client-asset (CASS) rules, reducing harm if an operator winds down or fails.
- Why now: the 2022 collapse of Hartley Pensions and, more recently, the WealthTek custody failure exposed the protection gap.
- Timeline: the consultation closes 24 August 2026; final rules are targeted for the first half of 2027, with a proposed two-year period before they take full effect.
- For you: nothing to do today. If the rules go through, the main effect is a higher baseline of operator conduct and better protection of your assets, not a change to your investments or allowances.
What the FCA is proposing
CP26/20 is a consultation, not a finished rulebook. It sets out the FCA’s preferred approach and asks the industry for feedback before final rules are written. There are two main planks.
1. Due diligence on the firms that feed business into SIPPs
A SIPP operator rarely works alone. Advisers, introducers, and investment platforms all route members and investments into SIPPs. Historically, some of the worst consumer harm in the SIPP market came not from the operator itself but from what it allowed onto its platform: high-risk, illiquid, or outright fraudulent investments introduced by third parties that the operator failed to scrutinise.
CP26/20 proposes explicit, mandatory due-diligence standards for operators on these third parties. That means checks before a relationship begins and ongoing monitoring afterwards, rather than a one-off box-tick. The aim is to make the operator a genuine gatekeeper, responsible for the quality of what flows through its scheme, not a passive administrator that processes whatever an introducer sends its way.
2. A new safeguarding regime for your money and assets
The second plank is a proposed Pension Scheme Money and Assets regime, referred to in the paper as PSM&A. Its purpose is to protect client money and assets held within a SIPP that are not currently covered by the FCA’s existing client-asset rules, known as CASS.
This is a technical point with a real-world consequence. CASS rules require regulated firms to keep client money and assets separate from their own, so that if the firm fails, your money is ring-fenced and can be returned rather than being caught up with the firm’s creditors. The FCA’s concern is that certain money and assets inside SIPP structures have sat in a gap where those protections did not clearly apply. The PSM&A regime is intended to close that gap, so that if a SIPP operator fails or winds down, member money and assets are properly protected and easier to return.
Why the FCA is acting now
Two episodes explain the timing.
The first is the collapse of Hartley Pensions in 2022. Hartley was a SIPP operator that entered administration holding tens of thousands of client pensions, exposing exactly the kind of wind-down and asset-protection problems the PSM&A regime is designed to address. Administering a failed SIPP operator, returning assets, and covering the costs proved slow and painful for the members caught in it.
The second is more recent. On 25 June 2026 the FCA publicly censured CACEIS UK, a sub-custodian bank, over its role in the WealthTek scandal. CACEIS held accounts for WealthTek despite three checks of the Financial Services Register showing WealthTek lacked the permissions to hold those assets. A legacy monitoring system generated 16 alerts on accounts taking in 314 million pounds, none of which were properly resolved. Rather than a fine, which the FCA said would have been 33 million pounds, CACEIS agreed a 31.7 million pound voluntary payment to affected clients. Across three actions in twelve months, the FCA has now secured about 57 million pounds for WealthTek clients.
The WealthTek case is about custody and register checks rather than SIPPs specifically, but the FCA cites it as the kind of failure the SIPP proposals are meant to prevent: weak due diligence and gaps in asset protection that leave ordinary savers exposed when something goes wrong further up the chain.
The timeline
- 22 June 2026: CP26/20 published, opening the consultation.
- 24 August 2026: consultation closes. Operators, trade bodies, and advisers submit responses.
- First half of 2027: the FCA aims to publish a policy statement and final Handbook text, confirming the rules.
- Roughly two years later: a proposed implementation period means the rules would not bite immediately. Operators would have time to build the systems and controls the new standards require before they take full effect.
In other words, this is a direction of travel rather than an overnight change. The consumer protections it promises are real, but they arrive gradually.
What it means for DIY SIPP investors
What improves
- A higher baseline of operator conduct. If the due-diligence rules go through, the operator running your SIPP has a clearer, enforceable duty to vet the introducers and investments that reach its platform. That reduces the chance of a dubious or fraudulent investment slipping into the market through a weak operator.
- Better protection if an operator fails. The PSM&A regime is designed to make sure your money and assets are ring-fenced and returnable if your SIPP operator winds down. For anyone who remembers the Hartley Pensions saga, that is the point that matters most.
- A tidier market. Higher standards tend to push the weakest operators out. That can mean some consolidation, but the operators that remain should be more robust.
What stays your responsibility
- Investment risk is unchanged. Better operator conduct does not make your holdings less volatile. If you hold shares or funds in a SIPP, their value still rises and falls with markets. The FCA is regulating the plumbing, not the weather.
- Your investment choices are still yours. The whole point of a SIPP is self-direction. These rules make the operator a better gatekeeper; they do not vet your individual fund or share selections for suitability.
- High-risk investments remain high-risk. Unregulated, illiquid, or exotic investments that some SIPPs permit do not become safe because operators face tougher checks. If anything, tighter due diligence may mean fewer of them reach the market in the first place.
FAQ
Is my SIPP safe right now?
SIPPs from established, well-run operators are a mainstream retirement product used by millions of people. CP26/20 is not a warning that SIPPs are unsafe; it is the FCA raising the minimum standard across the market and closing a specific gap in how client assets are protected if an operator fails. If you are with a large, long-established provider, the practical effect of these rules for you is likely to be modest.
Do I need to do anything?
No. This is a consultation on proposed rules, not a change that takes effect now. There is nothing you need to do today. It is worth being aware of the direction, and if you use a smaller or newer SIPP operator, keeping an eye on how the market consolidates over the next couple of years.
Will this affect the fees I pay?
Possibly, over time. Meeting higher due-diligence and safeguarding standards costs operators money, and some of that cost could feed into charges. Equally, a tidier, more competitive market can push fees the other way. The consultation does not set fees, and any effect would be gradual rather than immediate.
What is the PSM&A regime in plain English?
It stands for Pension Scheme Money and Assets. It is a proposed set of rules to make sure the money and assets held inside your SIPP are kept separate from the operator’s own money and are protected if the operator fails. It fills a gap left by the FCA’s existing client-asset rules (known as CASS), which did not clearly cover some money and assets inside SIPP structures.
Is this the same as FSCS protection?
No. The Financial Services Compensation Scheme can compensate you, up to its limits, if a regulated firm fails and cannot meet its obligations. The PSM&A regime is different: it is about ring-fencing and returning your own money and assets so that, ideally, you do not need to claim compensation in the first place. The two work alongside each other rather than being the same thing.
When would the rules actually start?
The consultation closes on 24 August 2026. The FCA aims to publish final rules in the first half of 2027, and has proposed a further period of around two years before they take full effect. So the earliest the finished rules would fully apply is likely to be 2028 or later.
Savvy Investor’s take
This is a sensible, overdue piece of housekeeping rather than a dramatic reform. The SIPP market has grown enormously, and the rules governing what operators must check and how they must protect client assets had not fully kept pace. The Hartley Pensions collapse showed how messy a SIPP operator failure can be for ordinary members, and the WealthTek case is a fresh reminder that gaps in custody and due diligence are not theoretical.
For most DIY investors the day-to-day experience of running a SIPP will not change. What changes is the safety net underneath it: a clearer duty on operators to keep bad investments out, and better protection for your assets if the worst happens. That is worth having, even if it arrives slowly. The one thing to watch is consolidation. If tighter standards push some smaller operators out of the market, a minority of savers may find their provider sold or wound down, so it is worth knowing who ultimately holds your pension and how robust they are.
If you want to understand where a SIPP sits alongside other tax wrappers before deciding how much to hold in one, our ISA vs SIPP comparison is the place to start, and our guide to the FCA’s new targeted support rules for pension savers covers a related strand of the same consumer-protection push.
Information, not advice. This article is educational information about a regulatory consultation. It is not personal financial advice. Savvy Investor Guide is not authorised or regulated by the Financial Conduct Authority. We are not financial advisers. Nothing in this article is a recommendation to open, keep, transfer, or close a SIPP, or to use any particular provider. Your financial decisions are your own; if you need personal advice, speak to an FCA-authorised financial adviser.
Key Official Sources
- FCA CP26/20 consultation paper (22 June 2026): Adapting our rules for a changing market: self-invested personal pensions
- FCA press release on the SIPP proposals (22 June 2026): FCA consults on proposals to support strong, consistent standards in the SIPP market
- FCA censure of CACEIS UK over WealthTek (25 June 2026): CACEIS UK censured and to pay 31 million pounds to WealthTek clients