PensionsAug 9 2017

Rival providers row over pension transfer rights

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Rival providers row over pension transfer rights
ByDamian Fantato

Advisers seeking to help their clients access their pension money have found themselves caught between two rival pension providers embroiled in an ongoing conflict over pension transfers.

Pensionbee, a fintech pension provider, has complained to traditional life company Aegon about its slow transfer processes. 

The newer kid on the block has claimed its older rival is employing systems which are directly targeting it, and making life more difficult for Pensionbee customers.

Both companies are members of Origo Options - a service which facilitates pension transfers - but since June, Aegon has refused to transfer to Pensionbee using the service.

Pensionbee, which is regulated by the Financial Conduct Authority and registered with HM Revenue & Customs, has attempted to clarify why Aegon has taken this stance, but a  spokesperson said it has not been given an explanation.

Aegon has countered that it has treated all transfers from Pensionbee in line with its due diligence processes.

However Pensionbeen claims illogical inconsistencies in Aegon's processes - and delays in carrying out pension transfers of up to seven months.

For example, one Pensionbee client was able to transfer one pension electronically but the other had to be done by completing a series of paper forms.

Clare Reilly, head of corporate development at Pensionbee, said: “We are concerned that Aegon is preventing customers from switching efficiently and has arbitrarily changed its transfer processes despite already making hundreds of electronic transfers, totalling millions of pounds, to PensionBee.

“We are increasingly troubled by Aegon's treatment of customers and urge Aegon to rectify the situation as soon as possible to prevent any further consumer detriment from occurring.

“We have attempted to resolve this issue with Aegon via every means available to us.

“Their refusal to offer any specific reason for blocking electronic transfers or engage in any meaningful discussion on the matter is extremely frustrating for our customers, many of whom have now been trying for months to leave Aegon.”

Several Pensionbee customers have now complained to Aegon over the length of time it has taken to transfer between the two companies.

In a bid to address Aegon's sudden decision to stop using Origo Options for transfers to Pensionbee, the fintech pension provider's chairman, Mark Wood, a former UK chief executive of Prudential, has written to Adrian Grace, the chief executive of rival Aegon.

But the issue has not been resolved, with Mr Wood claiming Mr Grace refused to discuss the matter with him.

Pensionbee was founded in 2014, offers online pension plans and has had more than 38,000 sign-ups since it was launched.

A number of Aegon clients attempting to transfer to Pensionbee have been sent letters suggesting they consider whether they are transferring into a scam along with a leaflet from The Pensions Regulator on how to avoid scams.