Dennis Hall: When a provider relationship turns sour


I recently advised one of our clients to use the new pension freedoms to close her pension with AJ Bell and withdraw the entire sum as a lump sum. It formed part of a much larger portfolio of investments but the pension pot was relatively small.

For our involvement we agreed to charge the client about £500, paid from the pension fund before it was finally paid out. We submitted all the paperwork to AJ Bell making this very clear. You already know what’s coming.

At this point AJ Bell paid the client without deducting our fee. Several days later we received the paperwork and noticed the fee had not been deducted, so we asked AJ Bell what they would do about it.

After some to- and fro-ing they said they would write to the client asking for the money back and thanking us for highlighting a training issue. When will product providers stop spouting platitudes and instead pay for their mistakes (financial pain being the only pain they feel)?

I do not want AJ Bell to go back to my client asking them to return the money – it is not as though the sum was significant enough for them to notice. As far as they are concerned they received a net payment. Anything I have read about behavioural economics or the psychology of loss tells me the pain of losing money is twice as painful as gaining it.

My clients would feel a sense of loss far greater than the £500 they had agreed, which would impact on our relationship, and so for the sake of £500 I am left wondering whether I bear the loss or make the clients feel as though it cost them £1,000. AJ Bell on the other hand has not have suffered any loss, and although it has discovered a weakness in their processes it has suffered no pain.

By last week I believed we had reached an impasse. This is not the AJ Bell I started out dealing with more than 10 years ago – back then when something went wrong they held up their hands and fixed it. It was so refreshing, and it shaped my own attitude to handling clients complaints – we even have a ‘no quibble’ guarantee on our website.

So when I tweeted on Friday that my long running association with AJ Bell had sadly come to an end it triggered a response that I was not expecting.

One of the senior management team picked up the tweet whilst on holiday in Florida, and immediately called me. It is hard not to take anyone seriously when they interrupt their downtime to try and save a relationship. That is the AJ Bell I had experienced in the past.

With senior management involvement there was a thawing of the ice. We still did not reach the ideal solution from my perspective, but we got halfway there. And for that I am satisfied.

They still don’t quite ‘get’ where I am coming from – but then I am not a multi-million pound provider. I can care that little bit more, and I treat my clients in exactly the same way I would wish to be treated – and I live in a fantasy world where I believe providers should do the same.

Dennis Hall is managing director at Yellowtail Financial Planning

AJ Bell declined to comment