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James Hay to pay out over pension transfer error

James Hay must pay redress to a client following a pension transfer error that meant some of her money was not reinvested for four years.

The client also made a complaint against her adviser – named as Credit Suisse in a separate Financial Ombudsman Service decision – which was upheld.

The complainant – called Ms T in the FOS decision – wanted to move her pension from one adviser to Credit Suisse. The Sipp provider was to remain James Hay.

One of the funds Ms T wanted to transfer had to be sold first, so it was arranged this would happen separately. Once the fund was sold, around £250,000 was transferred into the Sipp bank account in May 2012.

Ms T asked in 2015 and 2016 about a large amount of cash sitting in the Sipp bank account that hadn’t been invested. It turned out that the money had been received in May 2012 but had not invested with Credit Suisse.

The money was eventually transferred to Credit Suisse in April 2016 but it was invested four years later than it should have been. Ms T complained to both James Hay and Credit Suisse saying she had lost out on “significant growth” on her investment.

The FOS investigator initially said James Hay and Credit Suisse should share responsibility for the error but then decided James Hay was not at fault for what went wrong.

Credit Suisse wanted the decision referred to an ombudsman and the FOS was also referred the case against James Hay.

Ombudsman Michelle Henderson upheld Ms T’s complaint against James Hay and Credit Suisse and held them liable for 50 per cent of any losses.

The FOS has set out a redress calculation for both companies to put Ms T back in the position she would be in if the transfer was made in 2012. Both companies must also pay her £150 for distress and inconvenience caused.

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Comments

There are 2 comments at the moment, we would love to hear your opinion too.

  1. I wonder why it chanegd from being all Credit Suisse’s fault and then to being 50/50? Sounds like a cop out on the part of the FOS.

    • DRN8238117 and DRN3529850 apply.

      Reading the decisions, I think James Hay’s problem could have been avoided simply by including the phrase “we await your instructions”, thereby putting the ball firmly into the court of Credit Suisse.

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