In July, Hartley then received £1.757 from the Sipp, which Mr T once again complained about.
Later that same month, Hartley was placed into administration.
Pension Ombudsman complaint
In summary, Mr T told the Pensions Ombudsman that after Hartley took over his Sipp he was approached by advice firm Insight but Mr T rejected its offer and therefore Insight never provided him with any advice.
But in April 2019 he noticed that payment’s had been made by the Sipp’s pension platform, 7IM, to Insight each month from November 2018. Mr T told 7IM to stop making these payments and received a full refund from Insight.
The agreed fee structure with Greyfriars covered administration, advice, and discretionary fund management but it appeared Hartley had continued to charge Mr T on the same basis even though it only administered the Sipp.
In summary, Hartley said as it was unable to provide advice, Mr T was migrated to Insight. It would have invoiced Hartley and its fee would have been paid from the fees the provider received from the Sipp. But Hartley accepted that its communication to Mr T regarding Insight was poor.
Ombudsman’s decision
Deputy Pensions Ombudsman Anthony Arter found Hartley had not provided any contemporaneous evidence to show the exact fees that had been agreed with Mr T for administration-only services.
Hartley also did not inform Mr T that it had migrated him to Insight and Mr T was only made aware of this once fees had started to be deducted.
Arter said: “I find the lack of fee agreement, the failure to make Mr T aware of Insight and the failure to respond to Mr T’s queries regarding the deductions amount to maladministration. This also applies to Hartley’s handling of Mr T’s complaints.”
He therefore upheld Mr T’s complaint.
Arter ordered Hartley to pay Mr T £1,000 for the “serious distress and inconvenience he has suffered”.
It must also calculate the total fees Hartley should have deducted in respect of the Sipp each year (maximum of £440) and calculate the total fees it actually received and then pay Mr T the difference.
Peter Kubik, partner at UHY Hacker Young and joint administrator of Hartley, said: “Compliance and regulatory failings at Hartley were a contributing factor in the decision to place Hartley into administration and to appoint myself and Brian Johnson of UHY Hacker Young as joint administrators.”
amy.austin@ft.com
