UK - Trustees have been ordered to pay £10,000 compensation to a scheme member for deliberately delaying the transfer payment of benefits.
Pensions ombudsman David Laverick found that the trustees of The Postvine Limited Executive Pension Plan had committed maladministration by not responding to a transfer request from one of its members, Mr A Antonelli.
Antonelli claimed the trustees – Mr & Mrs Gledhill, who were also the owners of the sponsoring company – had used their position of power to delay proceeding and “settle old scores”.
Up until 1996, Antonelli was a co-owner of the sponsoring company, Antonelli Ristorante Pizzeria.
Antonelli told the ombudsman he had become “thoroughly frustrated” by the trustees for not responding to his request to transfer his £36,074.51 pension.
The trustees took from September 6, 2001 until January 24, 2003 to respond to the request, by which time the transfer value had fallen to £30,555.32 because of reductions in the terminal bonus.
Laverick found the trustees had repeatedly failed to reply to Antonelli’s letters and those of his pension provider, Standard Life.
And he explained that a payment of £36,074.51 in September 2001 would now be equivalent to £39,400.51 – a cost increase that the trustees would have to meet.
Laverick then increased the total compensation bill to £10,000 to reflect “the further injustice” caused by the trustees.
Sacker & Partners director of professional development Claire Carey stressed that trustees had a duty to react to members’ requests for transfer in a “timely fashion”.
She said, in this case, the trustees’ actions fell short of good administrative practice.
Linklaters pensions litigation partner Mark Blyth said: “The case demonstrates that the ombudsman is quite happy to impose investment costs for a delay in transfer.
“It is also a rare example of the ombudsman dishing out the maximum award – £1000 – for distress and inconvenience as prescribed by the courts.”
PP has compiled a list of what to watch out for over the coming months.
The Pensions Regulator (TPR) spent just under £60,000 on a rebrand, including the design of a new logo and implementation of a refreshed colour scheme, Professional Pensions can reveal.
In this week's Pensions Buzz, we want to know whether or not you believe default decumulation pathways are a good way to tackle members' confusion at retirement.
The increase in minimum auto-enrolment (AE) contributions has had little impact on opt-out rates - with cessations after April increasing by less than two percentage points, data from The Pensions Regulator (TPR) shows.