Multiple Products/Services Decision Reference 2023-0123

• Case Outcome: Rejected
• Subject Matter: Multiple Products/Services
• Reference: 2023-0123
• Date: 09 February 2023
• Finantial Sector: Investment
• Conducts Complained Of: Mis-selling (investment)

Decision Ref:

2023-0123

Sector:

Investment

Product / Service:

Additional Voluntary Contribution (AVC)

Conduct(s) complained of:

Failure to provide product/service information

Outcome:

Rejected

LEGALLY BINDING DECISION

OF THE FINANCIAL SERVICES AND PENSIONS OMBUDSMAN

Background

The complaint concerns the Provider’s provision of pension advice regarding the

Complainant’s imminent retirement. The Provider is the adviser for members of a public

sector superannuation scheme.

The Complainant was a member of the employer’s group AVC plan which was held with a

third-party provider. The AVC pays a 5% bonus on retirement, conditional upon meeting the

terms and conditions which requires the payment of 120 premiums, the equivalent of 10

years of payments to the AVC plan.

The Complainant’s Case

The Complainant submits that she returned to work in 2016, after a 2-year absence due to

a critical illness. The Complainant argues that she contemplated retiring on ill health grounds

earlier than her normal retirement age and in preparation, she attended two retirement

seminars organised and run by the Provider during the period 2016 - 2019. The Complainant

contends that at one of these seminars, an agent of the Provider, H, advised her that if she

was 6 months short of the 10 years of payments required under the AVC plan when she

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/Cont’d…

retired, there would not be a penalty and she would still get the 5% bonus under the AVC

plan.

The Complainant states that her employer offered her the opportunity to retire in January

2019 and she contacted the Provider to discuss retirement plans and to find out information

in relation to the retirement option offered. The Complainant further states that she made

several phone calls to the Provider with a view to arranging a meeting with an agent

dedicated to dealing with queries on behalf of her employer, but that this agent was

unavailable. The Complainant attests that eventually an agent, D, spoke to her in relation to

her impending retirement and drawing down her AVC benefits but she says that D was doing

her a favour as he was not the agent who looked after clients of her employer.

The Complainant asserts that D advised her that she would have sufficient funds to make up

the shortfall of the lump sum deficit which she was aiming for, and he went through the

pension calculation with her. The Complainant further asserts that D was unable to advise

her on the 5% bonus or the number of years that she had accumulated in the AVC plan.

The Complainant submits it was not until 21st January 2019, that she was able to meet D

and that it was not until June 2019 that she received her first pension payment, despite D

having advised that it would take a period of two months. The Complainant further submits

that during this period, she made several phone calls to D, to ascertain the reason for the

delay and to enquire about the 5% bonus, but no information was proffered.

The Complainant submits that in June 2019, she was informed she would not be entitled to

the 5% bonus and that the Provider was still not able to give her a breakdown of her years

of service, and the shortfall to her bonus. The Complainant submits that she subsequently

received a letter from the Provider stating that she was 3 years short of the 10-year

requirement and it was pointed out to her at this stage, that she had withdrawn from the

scheme for a period of time. The Complainant submits that until then, she had forgotten

about the break in the payments to the policy.

The Complainant states that she subsequently remembered a previous meeting with

another agent of the Provider, W, at which it was decided she would have over and above

the requirements to make up the shortfall of the lump sum deficit which she was aiming for,

and it was on this basis that she ceased payments to the plan. The Complainant further

states that no consideration was given at that time, to the minimum number of payments

required to avail of the 5% bonus.

The Complainant sets out her belief that she was ill-advised by the Provider, because the

cessation of her payments resulted in the loss to her of the payment of the 5% bonus. The

Complainant submits that in an email dated 7 August 2019 it was confirmed that the break