Curtis Banks Self Invested Personal Pension · CAS-53398-K6J8

CAS-53398-K6J8

Ombudsman’s Determination Applicant Miss E

Scheme Curtis Banks Self-Invested Personal Pension (the SIPP)

Respondent Curtis Banks Ltd (Curtis Banks)

Outcome

Complaint summary

Background information, including submissions from the parties Miss E held the SIPP, which was administered by Curtis Banks and the investments in the SIPP were managed by Investec Wealth.

On 8 January 2020, Investec Wealth sent an email to Curtis Banks and informed it that Miss E intended to pay a pension contribution of £40,000 (the Contribution) into the SIPP. Investec Wealth requested information about the best way to do this.

On the same date, Curtis Banks replied that Miss E needed to complete a Contribution Form and submit it by post to its Bristol office. Alternatively, she could submit it using Curtis Banks’ online portal.

On 14 January 2020, Investec Wealth sent Miss E’s completed Contribution Form to Curtis Banks by email and asked it to check that it had been completed correctly.

On the same date, Curtis Banks replied that it required part 3.2 of the Contribution Form to be completed. It added that it could accept a copy via its online portal, but if it was sent by post then it required an original signature. It also confirmed that it could not accept “these forms” by email. CAS-53398-K6J8 On 17 January 2020, Investec Wealth sent a copy of the Contribution Form to Curtis Banks by email and asked it to confirm that it had been completed correctly, so it could send it by post.

On 20 January 2020, Curtis Banks replied that the Contribution Form did not show the Contribution, so this needed to be added before sending the form by post.

Investec Wealth posted the fully completed Contribution Form to Curtis Banks on the same date.

On 21 January 2020, Curtis Banks confirmed to Investec Wealth that it had received the Contribution. Investec Wealth asked Curtis Banks what was required for the Contribution to be transferred to Miss E’s investment portfolio.

On 22 January 2020, Curtis Banks replied that it required an instruction to be sent via its secure messaging system or in a signed letter.

Between 23 and 28 January 2020, Investec Wealth and Curtis Banks entered into further correspondence because the Contribution had not been transferred to Investec Wealth.

On 29 January 2020, Curtis Banks confirmed that Miss E’s investment instructions, which were shown in the Contribution Form, had not been actioned. Curtis Banks apologised for this and confirmed that the Contribution money would be transferred to Investec Wealth on the same date.

On the same date, Investec Wealth confirmed receipt of the money.

On 3 February 2020, Investec Wealth complained to Curtis Banks on behalf of Miss E, regarding the delay in transferring the Contribution for investment.

On 31 July 2020, Curtis Banks responded to the complaint. It said:-

• On 17 January 2020, it informed Miss E that it had received the Contribution. On the same date, Miss E informed Curtis Banks that the money was to be sent to Investec Wealth for investment. Curtis Banks could not do this until it had received a Contribution Form from Miss E, which it received on 21 January 2020.

• It was unacceptable that Curtis Banks did not complete the transfer of the Contribution to Investec Wealth until 29 January 2020. In accordance with the Financial Ombudsman Service (FOS) compensation guidelines, Curtis Banks had calculated interest at the rate of 8% per annum, which resulted in a loss of £70.24. This loss was the result of a delay of eight calendar days.

Miss E did not accept Curtis Banks’ offer.

On 20 July 2021, Miss E transferred the value of the SIPP to another pension arrangement.

In her submissions to The Pensions Ombudsman (TPO), Miss E said in summary:-

2 CAS-53398-K6J8 • The Contribution was sent to Curtis Banks on 14 January 2020, using the Bankers’ Automated Clearing System (BACS). Curtis Banks would have received it by no later than the next day. She had already given her instructions to transfer the Contribution via a secure message, on 17 January 2020. Curtis Banks should have sent the money to Investec Wealth immediately after receiving her instructions.

• She did not have use of the money for a period of two weeks. She and Investec Wealth spent several hours trying to resolve the matter. Since then, she spent more time chasing a response to her complaint and a resolution. Even though Curtis Banks admitted its error, no satisfactory resolution had been achieved.

• This was not the first time she experienced poor administration by Curtis Banks. In 2017, it did not process a pension contribution paid by cheque from her employer for a period of three weeks after it was sent. As a result, the contribution was carried into the next tax year.

• She agreed with the fundamental principle of calculating her financial loss by means of an interest rate calculation. However, she disputed the period of delay identified by Curtis Banks. The relevant bank statement showed that the Contribution was debited to her employer’s account the day following the payment instruction, which was on 15 January 2020. So, it took two weeks for Curtis Banks to transfer the money to Investec Wealth. In her view, the amount of interest offered should be doubled.

• She sought financial compensation for the loss of use of the money, as well as compensation for the time she spent dealing with the matter and the inconvenience she had suffered. In her view, if one’s advisers alerted them to the fact that a sum of £40,000 had gone missing on its way to them, that person would feel angry, upset, and anxious, until the funds were discovered. In addition to the time she had wasted sending and responding to emails, and the subsequent necessity to raise a formal complaint, it was not possible to measure or document the additional time taken in telephone calls with Investec Wealth and other parties, trying to resolve the issue.

• It accepted that there was a delay in acting on Miss E’s instructions to transfer the Contribution to Investec Wealth. The Contribution cleared her SIPP account on 20 January 2020 and her Contribution Form was received on 21 January 2020. The money should have been sent to Investec Wealth following receipt of the Contribution Form.

• It apologised for the delay in transferring the money to Investec Wealth. It had not been able to establish the precise reasons for the delay. Curtis Banks was aware and had acknowledged receipt of both the Contribution and Miss E’s instructions. It would appear that the delay was a result of an individual administrative error.

3 CAS-53398-K6J8 • It did not have direct access to Miss E’s investment account, in order to establish what investments were made following receipt of the Contribution by Investec Wealth. Because of this, it calculated loss based on 8% interest per annum pro rata which, in its view, was fair and reasonable.

• Alternatively, it was prepared to obtain records of the investments Miss E made using the Contribution once the funds were received by Investec Wealth. It would then calculate what investments Miss E could have purchased if the money had been transferred to Investec Wealth at an earlier date and offer the difference to Miss E. However, it was not prepared to compensate Miss E for any perceived investment loss, which was the investment loss arising by mirroring any further investments and/or fund switches Miss E made with the Contribution, between 29 January 2020 and the current date. This was because, in Curtis Banks’ view, there was no evidence that the Contribution would have been used in a certain way and Miss E could not retrospectively confirm what she would have done with the additional funds.

Adjudicator’s Opinion

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Ombudsman’s decision

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I uphold this complaint in part.

Directions

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Anthony Arter CBE Deputy Pensions Ombudsman 13 November 2023

8 CAS-53398-K6J8 Appendix 1

“4 Contributions

…

4.6 Contributions may be single contributions or regular contributions and our contribution form must be fully completed in order for us to accept the contribution. Single contributions must be paid by cheque or direct credit. Regular contributions must be paid by direct debit and must quote the SIPP reference number in the payment narrative.

…

4.10 We will only act on an investment instruction when the contribution received is in a cleared funds state.”

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“151A Interest on late payment of benefit

Where under this Part the Pensions Ombudsman directs a person responsible for the management of an occupational or personal pension scheme to make any payment in respect of benefit under the scheme which, in his opinion, ought to have been paid earlier, his direction may also require the payment of interest at the prescribed rate.”

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“Payment of interest on late paid benefit

6. (1) For the purposes of section 151A of the 1993 Act (interest on late payment of benefit), the prescribed rate of interest shall be the base rate for the time being quoted by the reference banks.

(2) In paragraph (1) above—

(a) “base rate" means the rate for the time being quoted by the reference banks as applicable to sterling deposits or, where there is for the time being more than one such base rate, the rate which, when the base rate quoted by each bank is ranked in a descending sequence of four, is first in the sequence; and

(b) “reference banks” means the four largest persons for the time being who—

(i) have permission under Part 4 of the Financial Services and Markets Act 2000 to accept deposits,

(ii) are incorporated in the United Kingdom and carrying on there a regulated activity of accepting deposits, and

(iii) quote a base rate applicable to sterling deposits.”

11 CAS-53398-K6J8 Appendix 4 Relevant extracts of the Pension Schemes Act 1993

“151 Determinations of the Pensions Ombudsman.

(1) Where the Pensions Ombudsman has conducted an investigation under this Part he shall send a written statement of his determination of the complaint or dispute in question—

(a) to the person by whom, or on whose behalf, the complaint or reference was made, and

(b) to any person (if different) responsible for the management of the scheme to which the complaint or reference relates]F2...

and any such statement shall contain the reasons for his determination.

(2) Where the Pensions Ombudsman makes a determination under this Part or under any corresponding legislation having effect in Northern Ireland, he may direct any person responsible for the management of the scheme to which the complaint or reference relates to take, or refrain from taking, such steps as he may specify in the statement referred to in subsection (1) or otherwise in writing.”

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