Standard Life Staff Pension Scheme has been ordered by the Pensions Ombudsman to pay nearly £20,000 to one of its members for delaying his pension transfer, which led to investment losses.
Its member, known as Mr L, complained to the Ombudsman that he was provided with misleading information regarding his right to transfer, resulting in the losses.
The Ombudsman upheld his complaint and ordered the trustees of the scheme to pay £18,156 into Mr L’s Standard Life pension plan within 21 days.
Mr L is currently an employee of Standard Life and had a DB pension accrued during his employment, while also contributing into a work based DC scheme.
Wanting to consolidate his benefits, Mr L set up a Standard Life Group Flexible Retirement Plan to transfer his benefits into and arranged for future contributions to be paid into it.
In November 2016, Mercer provided him with a guarantees transfer value statement, which was for three months, after which Mercer confirmed that he had returned all the relevant transfer paperwork “before the guarantee period expired”.
Despite this, a delay ensued and Mr L raised a formal complaint with the scheme and received an e-mail from Mercer on 1 August 2017 explaining that: “As the member is an active member he is not entitled to a statutory transfer and as such the requirement to settle the transfer within six months statutory window does not apply.”
On 2 August 2017, the transfer went through, and the trustees acknowledged that the transfer was unduly delayed and said that they would pay Mr L £4,305 in interest and £500 in compensation.
Mr L was not satisfied with this, even after Standard Life offered to increase the payment by £443 and compensation by £250, and referred the complaint to the Pensions Ombudsman.
Deputy Pensions Ombudsman, Karen Johnston, ordered the trustees to pay £18,156 into Mr L’s pension plan and noted that that the trustees increased their offer of compensation to £1,500, which she believed to be “satisfactory”.