The Pensions Ombudsman has rejected a claim, made by a victim of a carbon credit scam, that his original financial adviser did not carry out sufficient due diligence to protect his pension assets.
In the determination, the defendant, cited as Mr D, complained that Pension Practitioner.com had not prevented the loss of his pension fund assets.
This came after he set up a small, self-administered scheme (Ssas) on the instigation of an unauthorised financial adviser, and subsequently invested in a worthless carbon credits scheme.
The initial investigation by the adjudicator found that Pension Practitioner had no case to answer, but Mr D did not accept the adjudicator’s opinion and the complaint was passed to the ombudsman to consider.
However, ombudsman Anthony Arter said: "Although I have every sympathy for the position Mr D finds himself in I do not find Pension Practitioner can be held liable for a fraudulent act committed by another party."
Therefore, he did not uphold Mr D's complaint.
The basis of the complaint followed the loss of Mr D's pension money after an unregulated adviser, Mr Parrington of Anthony James Hall (AJH), introduced Mr D to a company called SJL Risk, through which Mr D invested in worthless carbon credits.
The problem started, Mr D claimed, when AJH contacted Pension Practitioner stating that Mr D wanted to set up a Ssas back in 2011.
AJH told Pension Practitioner Mr D was interested in making a loan to his existing company by using money from a policy he had with Skandia which he wished to transfer to the new Ssas.
Pension Practitioner sent AJH the documents to set up a Ssas.
Included in the documents was a letter to Mr D setting out how the Ssas would operate and a statement that Pension Practitioner was not a signatory to any investments or bank accounts and did not recommend any investment products or give investment advice.
In April 2012, Pension Practitioner received the completed forms to establish the Ssas.
Pension Practitioner said it also discussed the transfer from Skandia with Mr D and completed the necessary transfer forms.
Skandia subsequently paid a transfer of £228,367 into a new Investec bank account.
In June 2012, Pension Practitioner wrote to Mr D’s accountant requesting information regarding the financial strength of the company in relation to the pension scheme loan.
In July 2012, AJH confirmed with Pension Practitioner the employer was not seeking a pension scheme loan at that time.
Mr D was subsequently introduced to SJL Risk by AJH, and proceeded to make investments in carbon credits which have subsequently proved to be worthless.
Mr D said he did not sign the application forms to invest in carbon credits and his signature was forged by AJH.
He told the ombudsman rgar Pension Practitioner should have told him it was advisable to appoint a second trustee, such as Pension Practitioner itself.