Pensions  

Ombudsman finds against AJ Bell over benefits

Ombudsman finds against AJ Bell over benefits

Sipp provider AJ Bell has been accused of maladministration in its decision not to award a woman any death benefits from her partner’s pension.

Pensions Ombudsman Anthony Arter ruled in favour of the woman - knows as Ms V - who argued she should be given a death benefit because her partner, Philip Scott, was in the process of nominating her as a beneficiary when he died suddenly.

The couple had been partners for four years before his death in 2012 and had bought a house together in 2009.

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Shortly before the couple purchased a house together, Mr Scott had completed a nomination form, which named himself as sole beneficiary, but did not manage to change this before he died.

AJ Bell had said the nomination was a “relevant and important factor” to be taken into account and that the couple’s shared living expenses were not sufficient reason to override this.

It added there was insufficient evidence to establish that at the date of his death Mr Scott had decided to make a nomination in Ms V’s favour.

But Mr Arter said: “The way AJ Bell have considered this matter indicates to me that, in effect, the questions they actually asked were: what were Mr Scott’s wishes and could they comply with these? These were not the correct questions.

“Mr Scott’s wishes were but one factor to be considered by AJ Bell; albeit a valid and important one. AJ Bell were not and should not have allowed themselves to be bound by those wishes.

Mr Arter added: “I therefore find that there was maladministration by AJ Bell in that their decision whether or not to exercise discretion in Ms V’s favour was flawed.”

Mr Scott’s solicitor said they had discussed nominating his partner as a beneficiary and that in May 2012 he had received information about this, but had been on holiday and was then involved in a family bereavement. Mr Scott died in early July 2012.

Mr Arter gave AJ Bell 28 days to reconsider the distribution of the lump sum death benefit.

He also told the company to pay Ms V £1,000 as a form of redress.