Suffolk Life  

Ombudsman backs Suffolk Life over Sipp fees

Ombudsman backs Suffolk Life over Sipp fees

The pensions ombudsman has rejected a claim that Suffolk Life failed to clearly explain transfer fees.

A client, referred to as Mr H, complained about the fees he was charged when transferring his pension fund from Suffolk Life to Interactive Investor.

Mr H claimed he was charged £1,485 for the transfer and had not been informed of the charge by Suffolk Life.

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The account was initially administered by European Pensions Management Limited, which entered into administration in June 2016 while Selftrade was the stockbroker that held the assets of the plan.

Selftrade had control over the investments rather than acting as a direct manager.

On November 9, 2016, Suffolk Life wrote to Mr H explaining it had taken over the accounts held with EPML.

The letter stated that Suffolk Life had decided to close the EPML scheme and transfer the plan to a Master Sipp administered by its Ipswich office.

The letter included information about switching to another provider if Mr H felt the Master Sipp was not the right product for him.

In order to move to an alternative provider, Mr H was required to initially transfer the plan to the Master Sipp with Suffolk Life, which would allow a full reconciliation.

The plan could then be transferred to a provider of Mr H's choice, without incurring any Suffolk Life transfer fees.

This letter stated that transfer out fees may be applied by any third party which held assets on behalf of the plan.

It also stated that Suffolk Life fees would be restricted to match those charged by EPML.

In December 2016, Mr H informed Suffolk Life that he felt the Master Sipp was not the right product for him and he wanted to transfer to Interactive Investor.

Suffolk Life then sent out transfer documents, which stated: "We aren't currently aware of any third-party fees that will apply to the transfer.

"However, the investment or fund manager may decide to charge a fee. Any fees they charge will be taken directly from either the investment account or the Sipp bank account."

Suffolk Life also stated it would confirm the estimated transfer out fee once the transfer was complete.

In June 2018, Mr H sent Selftrade an email to question why he was charged so much for the transfer of his account to a new provider.

Selftrade responded to Mr H, explaining that the exit fees for a transfer out to another provider were £15 per line of stock.

It then referred Mr H to its website which lists the fees and charges applicable for a transfer out.

Mr H claimed Selftrade said Suffolk Life should have made him aware of the fees.

However pensions ombudsman Anthony Arter ruled Mr H wouldn't get any compensation as Suffolk Life provided warnings that there could be potential charges for the transfer of assets to other providers.