Ted Shaw, director at Crowborough-based financial advice firm EJ Financial, said he was shocked and disappointed when he discovered the charge.
“I think this is not treating the customer fairly. Phoenix clients should be able to access their pensions to do with what they want under the new pension freedom rules.”
One Phoenix client is within six months of her normal retirement date and has a pension of £9,323.60, which Mr Shaw said will be subject to a market value reduction of £3,176.30 on her defined contribution pension - a penalty of 34.06 per cent.
Her husband will also experience a market value reduction of £17,609 from a defined contribution pension fund of £49,969 - a total reduction of 35.43 per cent.
Mr Shaw said the heavy penalties had not been explained to the pair when they took the policies when Phoenix Life bought the policies from the original provider.
“Some legacy pensions have been sold without proper communication of all the rules regarding early transfer and encashment penalties by the original adviser,” he claimed.
Retirement freedoms came into effect on 6 April 2015, allowing retirees to take their pension savings as a lump sum.
A spokesperson for Phoenix Life said the company is awaiting the outcome of an upcoming Financial Conduct Authority consultation on an exit fee cap before making any changes to its charges.
The government plans to cap pension exit fees before March next year for people over 55 who want to access their pensions. The FCA is currently consulting on where to set the limit.
In March this year, the government announced that closed book life companies are to face regulatory scrutiny after an FCA investigation found a lack of transparency around the fees they charge customers.
The FCA is to convene an industry-wide discussion with a view to reaching a voluntary solution to capping or removing exit charges and other penalties on investments held by closed book companies.
According to the Phoenix Life spokesman, more than 80 per cent of its policies have no exit charge at all and policyholders that stay until their selected retirement date pay no exit charge.
They added the provider has seen no evidence any customer incurring an exit charge is deterred from taking advantage of pension freedoms before their selected retirement date.
But Mr Shaw claimed Phoenix Life provided poor client service and were not responsive to requests for information. He called for pension legislation allowing early transfer benefits.