The Financial Ombudsman Service has decided that Mattioli Woods must pay compensation over a botched Sipp administration which resulted in delays to a transfer, but does not have to pay back some of the fees it charged.
Despite an initial ruling in his favour, a client said the FOS adjudicator had calculated redress unfairly, and that Mattioli Woods was “dictating” to the FOS to avoid paying appropriate compensation.
A client originally had two Sipps, one, Pilgrim Sipp, collecting rental income from a property held in a separate group Sipp, and a second, E V Group Sipp, holding land overseas.
When Pilgrim went into administration in 2012, Mattioli Woods took over as administrators, saying it would keep Pilgrim’s charging structure, where fees were waived because Pilgrim had a reciprocal business arrangement with the client’s business.
Mattioli Woods told the client when they wanted to transfer that the Pilgrim Sipp held a property asset, so they would still have to charge after cash was transferred.
After a delay, Mattioli found the relevant paprework to confirm the Sipp was actually held in the Group Sipp, and was then able to transfer.
Mattioli Woods continued to take fees from the Pilgrim Sipp while the status of the property asset was agreed on, and the client claimed to the FOS that he was entitled to compensation for this, because he had not signed a new fee agreement that would change his charges under a new administrator.
An adjudicator had already ruled Mattioli Woods made an error on where the property was held, so should compensate for any potential investment loss during the delay.
The client argued again for the fees to be refunded, but an ombudsman deicision confirms that the original decision stands.
The decision from ombudsman David Bird reads: “I do not believe that addiing interest to the money that was transferred late is the approriate approach to redress….The ‘delay period’ was not based on picking a low point in the market but on the delay period that actually occured.”
“I allowed for the fees incurred after May 2015 in the overall redress calculation. I do not believe it would be fair to separately refund them. Their effect is incorporated into the redress.”