Chris Ioannou, senior financial adviser at Prestige in Bolton, said his client Ms Noad was left in "severe financial hardship" after Aegon failed to pay her retirement income.
Aegon had required Mr Ioannou to request every month by post that an income withdrawal be made from Ms Noad’s drawdown account.
He first requested the income in August 2018, but Aegon said it did not receive this and asked him to resend it.
Eventually a payment was received in December 2018 but the following payments were again not received.
Mr Ioannou said: “This left the client in severe financial hardship. They had to go back to work because of it.”
Mr Ioannou is also unhappy with how Aegon dealt with the same client's Isa account. The client was transferred onto the Cofunds platform in April 2018, a month before the fateful replatforming to the Aegon platform that caused a raft of issues for advisers throughout the year.
The previous provider, Axa, processed the request at the end of July 2018. But as it turned out the money wasn’t invested until December 4, 2018.
Mr Ioannou said: “This left my client very worried, as she didn’t actually know where the money was.”
Aegon offered Mrs Noad £250 in compensation for the trouble caused but the client was not happy about this offer and took her case to the Financial Ombudsman Service.
She decided to leave the platform in January to move to the slightly costlier Transact platform, which incurred further set-up costs and took until July to complete.
An initial opinion from the Fos adjudicator, seen by FTAdviser, determined that Aegon should pay more as well as refund any charges levied on her funds.
The opinion, by read: “Overall I think Mrs Noad has been through a very poor experience. She’s had to worry about a large amount of money go missing, her accounts not being managed properly (during which time she was still being charged management fees) and not been able to request an income from her own funds in a timely manner leaving a retiree to go back to work at a time when she should have been able to enjoy retirement.
"So whilst I acknowledge the £250 compensation paid after the complaint was brought to our service, I don’t think it fairly reflects the issues I’ve mentioned here.
"I think in addition to the comparing values of units sold and working out whether there was a loss, Cofunds should compensate Mrs Noad with a further £750 for all the trouble and hardship she has been through."
He added Cofunds should refund any charges applied to Mrs Noad’s funds throughout her time with Cofunds.
"Furthermore, I think Cofunds failed to communicate and act on matters decisively when I think they reasonably should have," he added.
"The reason for Mrs Noad moving her funds to Cofunds was to receive natural income and this was already confirmed.
"Given all this, I think the reason to leave Cofunds was completely understandable.
"If there were any charges associated with leaving Cofunds these should also be waived.”
An adjudicator's views represent the first stage of the complaints process at the Ombudsman and are not binding on firms.
As Aegon has decided to contest the verdict and take the case to the next stage, an ombudsman will reassess any objections and come to a final binding decision.
Meanwhile Mr Ioannou said he has not charged his client the usual fees up to now, and won’t do so until the portfolio has grown by 10 per cent.
An Aegon spokesperson said: “A final ruling is still to be reached by the Fos service on Ms Noad’s case and we’re currently in discussions with them to reach a fair outcome.”
The latest data from the Financial Ombudsman Service shows that the number of complaints against Cofunds fell by 69 to 113 in the first half of 2019, and was no means the firm with the largest number of complaints.
david.thorpe@ft.com
