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Pensions Ombudsman sides with Aegon over ‘misleading’ fund factsheet claim

The Pensions Ombudsman has ruled Aegon does not have to compensate a customer who complained that the growth of his workplace pension plan did not match the growth detailed in the fund factsheet.

In the case Mr A complains that the fund growth detailed in the plan’s fund factsheet does not match the limited growth achieved by his plan.

He suggests the fund factsheet is misleading, is not fit for purpose and would like Aegon to increase his fund value to match the returns detailed in the fund factsheet.

Mr A is employed by TCS which automatically enrols all its employees in a work based group personal pension administered by Aegon.

His plan is invested in the Universal Lifestyle Collection fund provided by Aegon and the fund’s stated aim is: “…to achieve long-term capital growth by investing in an internationally diversified portfolio, largely made up of equities.”

To help keep current members informed regarding the fund’s general performance Aegon produces a fund factsheet that details, among other things the investments performance against the stated benchmark.

Mr A raised his complaint about the growth of his plan not matching the growth detailed in the factsheet with Aegon.

Aegon did not uphold his complaint because the fund factsheet was not a guarantee of individual plan performance.

Mr A’s complaint was considered by one of the adjudicators who concluded that no further action was required by Aegon.

The adjudicator argues factsheets give very broad fund performance indicators and are not designed to provide definitive financial advice or to recommend investment suitability to any particular individual.

Furthermore, while factsheets provide broad information, they are not tailored to specific individuals hence the returns experienced by each individual will differ depending on their circumstances.

Mr A did not accept the adjudicator’s opinion and the complaint was passed to the Pensions Ombudsman to consider who sided with the adjudicator.

The Pensions Ombudsman says: “I can see nothing to demonstrate that the fund factsheet was not relevant and correct at the time it was produced or that the information provided is misleading in any way.

“The information the factsheet provides, while useful, is not legally binding and would always be subject to market fluctuations.

“It is not a guarantee of the investment percentage increase but what the fund is aiming to achieve, it may be more or less than the percentage shown. The fund factsheet is not a personalised statement of returns and should not be read as such.”

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Comments

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

  1. It amazes me that such ridiculous claims are allowed to take up time and expense when there are more serious matters going undetected. I am quite sure that the factsheet did not guarantee future returns, so why even waste the price of a postage stamp on it.

  2. Unless the Fact Sheet was very poorly written, this was always going to be a non starter.

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