The Pensions Ombudsman has rejected a complaint from a Suffolk Life client, who demanded a £1,000 refund for having to undertake “financial adviser type work” to resolve personal pension issues.
The client, referred to as Mr T, had a self-invested personal pension (Sipp) with European Pensions Management Limited (EPML), which was acquired by Suffolk Life in 2016.
As part of this acquisition, Suffolk Life contacted iDealing.com, an investment firm who Mr T had invested with through EPML.
The provider said attempts stalled, as iDealing, as standard, does not sign into Sipp company agreements.
Mr T argued that he spent 10 hours undertaking adviser work trying to understand the relationship between the two companies, which he calculated as being worth £100 per hour.
He also requested a refund from Suffolk Life of an administration fee of £240, and that he should receive an award for the distress and inconvenience caused by the matter as letters Suffolk Life sent him which he considers upsetting.
Between November 2016 and May 2017, the provider continued to try and correspond with iDealing.
However, iDealing refused to recognise Suffolk Life as its new Sipp provider.
In February 2017, Mr T complained to Suffolk Life as the funds transferred from his Sipp to iDealing could not be used for trading.
Suffolk Life responded to Mr T: “iDealing do not, as standard, sign into Sipp company’s agreements and have subsequently been unwilling to accept new funds received from Suffolk Life for trading in the existing accounts.”
To progress with the situation, the company completed iDealing’s online application to establish itself as a Sipp provider with them.
Suffolk Life also gave Mr T a list of investment providers it had agreements with.
In June 2017, Suffolk Life, after receiving another complaint from Mr T, sent its final decision letter.
It explained that despite its continuing efforts, iDealing were still refusing to accept its position as a Sipp provider.
Suffolk Life also explained that it had previously provided Mr T with the necessary paperwork to transfer to another pensions administrator should he wish to.
Mr T decided to transfer his Sipp a month later.
However, in August 2017, iDealing, without the consent of Suffolk Life, transferred Mr T’s investments to a new provider.
If Mr T was happy for the transfer to go through, then Suffolk Life would take no further action, the provider said.
Mr T complained to the Pensions Ombudsman, saying that Suffolk Life was holding his Sipp contributions “as hostage” during the time it was his provider.
In her determination, Karen Johnston, deputy Pensions Ombudsman, said that there was no maladministration by Suffolk Life.
She said: “As iDealing refused to recognise Suffolk Life as its new Sipp provider, Suffolk Life was unable to ascertain where Mr T’s contributions were being invested and were unable to reconcile the pension fund and meet their regulatory obligations.
“Therefore, I do not find Suffolk Life was acting outside its remit as Sipp provider in acting as it did.”
She also doesn’t consider that Mr T has suffered any loss as a consequence of the process.
The adjudicator that first analysed Mr T’s complaint said that it would be unreasonable for Suffolk Life to pay £1,000 as it was expected that he would have to spend some time trying to deal with the issue himself.
“Any further time Mr T spent dealing with the issue was his choice,” the adjudicator added.
Complaints about Sipp have been increasing, with the Financial Ombudsman Service receiving 521 new cases about these products, compared with 328 in the same period in 2016.
A smaller proportion of these are being upheld, with only 50 per cent being found in favour of the consumer, compared with 66 per cent in the first quarter of last year.
maria.espadinha@ft.com
