With the increasing number of complaints
being made to the Pensions Ombudsman, it is worth noting some of the decisions
published by his equivalent in the UK. One recent decision which made me stop
for a moment, was the decision by the UK Ombudsman in the determination of a
complaint by a Mr Middleton (80448/1) where it was held that a financial
adviser who takes on administrative duties relating to a pension fund transfer
comes within the Pensions Ombudsman's jurisdiction as an "administrator"
concerned with the administration of an occupational pension scheme. This is
the case even if the adviser does not consider that it was appointed or paid to
provide such services, and regardless of whether such actions might contravene
regulatory rules. The Middleton case was taken as a result of a loss caused by
a delay by Mr Middleton’s financial advisor to act on a set of instructions.
The advisor took six weeks to request a fund discharge form from a life
company. Secondly, it did not pursue the life company quickly enough when the
forms were lost. Thirdly, it mistakenly advised Mr Middleton that the transfer
value could not be lower than the last available figure provided.
It was held that the advisor had a duty to "carry out these
administrative tasks efficiently and on a timely basis" but that the
advisor had instead been responsible for several delays and mistakes amounting
to maladministration.
·
The Pensions Act 1990-2012 (the “Act”)
The
Ombudsman has jurisdiction to investigate specified complaints against or
disputes with persons responsible for the management of an occupational pension
scheme (scheme) or Personal Retirement Savings Account (PRSA). Under s131 of
the Pensions Act the Ombudsman may investigate a complaint relating to
maladministration “done by or on behalf of a person responsible for the
management of that scheme.”
Section
126 (3) and (4) of the Regulations specify those who are deemed to be
responsible for the management of a scheme or PRSA. Article 3 of the Regulations
extends the category of person deemed to be responsible to include the
administrator of a scheme or PRSA to the following:
1. any
person providing a service in relation to the administration of a scheme or a
trust rac;
2. any
person to whom the performance of the duties of trustees of a scheme or a trust
rac under section 59 (1) or (2) of the Act has been delegated;
3. any
person who is the administrator of the scheme or trust rac for the purposes of section
770(1) of the Taxes Consolidation Act 1997; or
4. any
person to whom the application or interpretation of the rules of a scheme or
trust rac has been delegated in accordance with those rules.
While
it is often clearer, in the case of non-insured arrangements, who the
administrator (s) is, it is not so clear when it comes to the establishment of
a pension arrangement by a life company where the paperwork usually appoints
the employer company as the scheme administrator.
Solicitor
ITC Consulting
