PensionsDec 10 2015

Baker Tilly must refund acquired client’s fee

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Baker Tilly must refund acquired client’s fee

Baker Tilly Financial Management has been told to refund fees for ongoing advice and annual reviews which it took from an acquired client, plus £200 for the trouble and upset caused.

The client, known as Mrs C, complained that when Baker Tilly bought the advice firm she met with in 2009, they continued to charge her fees for ongoing advice, even though they did not provide it.

Mrs C met with an adviser who was then working for Vantis to discuss how to invest the fund she was to receive from her ex-husband’s self-invested personal pension through a pension sharing order, opting to start a Sipp following that advice.

In 2010 RSM Tenon acquired Vantis’ assets, but not liability for advice given by Vantis, then in 2013 Baker Tilly subsequently acquired RSM Tenon.

From 2010 onwards, fees were taken from the Sipp for ongoing advice and annual review. In 2013 Mrs C replaced Baker Tilly as her adviser.

Initially a Fos adjudicator concluded that Baker Tilly was not responsible for the initial advice regarding where to invest, but Mrs C argued that the firm had taken annual fees for advice it did not offer and, so it should return these fees to her.

Baker Tilly agreed to pay £200 for the trouble and upset caused by not inviting Mrs C for annual reviews, but she did not accept this, saying that she would not have remained invested in a deposit account if she had taken the advice.

Mrs C wanted Baker Tilly to assess her losses by comparing the growth she could have received if she had invested elsewhere.

Ombudsman Helen McKenna reviewed the complaint and ruled that as the initial advice was provided by a different firm, Baker Tilly was not responsible for it.

While she was charged an annual fee of around £960 for on-going advice and annual reviews, Ms McKenna found no evidence that she received any advice following the 2010 takeover.

On probing the initial advice given, the ombudsman found Vantis had discussed the low returns Mrs C was getting on her money and suggested moving it.

But Ms McKenna said it also appeared that the decision was taken not to move the funds, as it was expected that she might be imminently drawing from them to bolster her finances.

The decision notice concluded: “I agree that it wasn’t reasonable for Baker Tilly to take the fee without inviting Mrs C for annual reviews.