Aviva subjected a client to lengthy delays after falsely assuming the client’s adviser did not hold the correct regulatory permissions to arrange a pension switch.
Alan Lakey, director at Highclere Financial, was embroiled in a month-long battle with the pensions and insurance giant to find out why his client’s pension had not been switched as requested, when Aviva told the client Mr Lakey was not allowed to do the transaction.
Mr Lakey told FTAdviser: “I’m extremely angry. I would have been angry even if it had been true, as Aviva should have come to me in the first instance, but it didn’t. Aviva told the client wrong information without even checking.
“Imagine if my client was the sort of guy to believe Aviva — once you lose the confidence of a client it is very hard to get it back.”
The situation was eventually resolved after both Mr Lakey and his client, Roger Sykes, filed official complaints with Aviva and called the firm multiple times.
Aviva told Mr Lakey the issue stemmed from a mistake made by the firm’s technical team after an employee had misinterpreted the difference between the rules for a pension switch and a pension transfer.
Mr Lakey does not have permissions to arrange a pension transfer — where there are safeguarded benefits involved, such as with a defined benefit transfer — but has the standard qualifications required to make a pension switch.
The requested action had been a pension switch from an old Axa personal pension, set up in 1993, to a Prudential policy. Mr Sykes wanted to take his 25 per cent tax free cash and de-risk the portfolio.
Mr Lakey said: “Why did it take four weeks and seven phonecalls from me, and more from Roger, before they told me the reason they had not transferred the cash?
“No one at Aviva was prepared to take responsibility. This is a massive firm, how did they make this mistake?”
Mr Lakey has now invoiced Aviva for £240 for the “unnecessary” time he and his staff had spent dealing with the issue and he expects a written apology to him and compensation for his client.
The client’s tale
Mr Sykes, Mr Lakey’s client, and his wife Kathy Sykes told FTAdviser the process of finding out what had happened to his pension pot was “really quite upsetting”.
The couple had been expecting to receive 25 per cent of Mr Sykes’s pension in a tax-free cash lump sum at the start of March and became concerned when, as time passed, the cash did not appear but the pension was no longer held in the Aviva account.