Plan 4 Pension

Pension planning guide


Scottish Equitable Fined 2.8m for Pension Admin Errors in Connection to Mis Sold Pensions

In December 2010 the FSA fined Scottish Equitable Aegon 2.8million for failures in their pension admin process which could have resulted in people carrying out pension transfers without being properly advised on the charges on the fund and this could possibly lead to you being mis sold pensions (if you have transferred in the past).

So if you have carried out any pension transfers from Scottish Equitable or Aegon in the past then you may have been mis sold pension without being aware of it. We will cover this in more details within this article.

The FSA statement outlines that they have fined Scottish Equitable 2.8million for their admin failures mainly within their pension business which will result in 60million being repaid to customers and also that Scottish Equitable found somewhere in the region of 300 errors in their admin procedures mainly within their pension policies.

Scottish Equitable identified these admin errors in 2009 and it has taken until now for the FSA to make it public but this is something we need to be asking questions on. The FSA should be answering customers questions regarding their policy on treating customers fairly especially when the problem was identified at least 12 months ago.

Most of the major problems identified mean that Scottish Equitable Aegon failed to issue almost 238,000 people their required documents (including pension documents) which is a default on a substantial amount of monies. If you failed to receive your pension documents and you did not get the opportunity to review the pension policy details then we believe this results in your 30 days cancellation rights being null and void as you did not have the pension details to review them in the statutory period they are obliged to provide to the customer.

If this applies to you and your fund has reduced or if you carried out a pension transfer then we feel you have the opportunity to receive compensation for this admin error.

The other major admin error that was encountered is that Scottish Equitable failed to calculate rebates to charges on policies including pensions to at least 25,000 clients which could have had an impact on your pension transfers from them which may have resulted in you being mis sold pensions as the figures they provided were inaccurate.

The next error they found was calculating peoples guaranteed minimum pension which again could have a bearing if you were considering pension transfers or carried out pension transfers during this time as the figures were again in accurate, resulting in pension transfers when this would possibly have been the incorrect thing to do. Especially if the correct figures been supplied.

Other areas that had failings included things such as if you had been contracted out of a state earnings related pension scheme (or SERPS as it is commonly known) then these type of pensions were not added to your fund when they should have been. If you carried out pension transfers during this period, the company had also failed to take appropriate steps to locate over 200,000 policy holders ( including pension policy holders ) who had moved without notifying them of their new address.

If you feel any of the above has applied to your pension or pensions with Scottish Equitable then you could be entitled to compensation. If you have carried out pension transfers from Scottish Equitable then you may have also been mis sold pensions because of this. We suggest you check to ensure you have not been a victim of a mis sold pension based on the information outlined.