Fidelity Funds Network Pension · CAS-65532-W1D0

CAS-65532-W1D0

Ombudsman’s Determination Applicant Mr L

Scheme Fidelity Funds Network Pension (the Scheme)

Respondent Fidelity International (Fidelity)

Outcome

Complaint summary

Background information, including submissions from the parties and timeline of events

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• It apologised that it did not inform Birchwood during the telephone call, dated 12 March 2020, that it would require an original copy of the FPC. This was because Fidelity had separate teams that dealt with different parts of the application process. Fidelity had provided feedback to the team concerned to prevent this happening again.

• It did not delay the application as the request was processed within its internal timescales.

• In respect of the poor service it had provided, it had paid £50 into Mr L’s bank account.

On 19 May 2020, Birchwood responded to say that it did not accept Fidelity’s response. It said that due to the delay in processing the request, Mr L had been financially disadvantaged.

On 15 June 2020, Fidelity responded to Birchwood as follows:-

• During the telephone call, dated 12 March 2020, it should have requested the original copy of the FPC.

• It should not have emailed the request to a member of staff at Birchwood on 14 March 2020, without first confirming that the person was involved with the case. It understood that the member of staff it emailed had no knowledge of Mr L.

• If it had correctly requested the original FPC on 12 March 2020, then the exception request should have been granted on 13 March 2020. Mr L’s assets

2 CAS-65532-W1D0 would then have been moved to the drawdown account and the switch to cash would have taken place on 17 March 2020.

• It reviewed the prices Mr L received on 27 March 2020 (£386,556.19) and compared them to the prices he would have received on 17 March 2020 (£371,716). It said Mr L was not disadvantaged by the delay as, had the trades taken place on 17 March 2020, then Mr L would have received £14,840.19 less.

• It apologised for the poor service it provided and, in recognition of the delay, paid Mr L a further £450, bringing the total paid as a gesture of goodwill to £500. It also paid Mr L a further £131.51 in respect of the 10 days that the payment was delayed. This was calculated at 1.6% simple interest minus 20% income tax.

Mr L’s position:-

• He considers that Fidelity has accepted it made errors.

• His request was made on 5 March 2020, but the investments were not sold until 27 March 2020. He does not understand why the sell down of the funds could not have taken place within five working days or one week of his request.

• He believes the date used for the calculation of his loss should be no later than 12 March 2020.

Fidelity’s position:-

• Birchwood did not specifically make a request to sell investments. If it had done this via Fidelity’s online system, then the sales would have been placed at the next dealing point.

• Instead, Birchwood requested a Benefit Crystallisation Event (BCE) which meant that the investment sales would only be placed after it had received all the required documentation.

• Its service level agreement (SLA) for the entire BCE process at the time was 15 working days.

Adjudicator’s Opinion

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Mr L did not accept the Adjudicator’s Opinion and the complaint was passed to me to consider. Mr L provided some further comments in response to the Opinion. Mr L said:-

• If the financial industry is going to retain credibility, then it is important that the institutions and those tasked with the responsibility of overseeing them take a fair position that protects the interests of the consumer.

• The opinion that in this digital age it is reasonable for a sell down to take three weeks seems both outdated and unacceptable, especially when Fidelity had all the documents at the point of the initial instruction on 5 March 2020.

• The process was managed very badly by Fidelity, leading to material loss.

I have considered the additional points raised by Mr L, however they do not change the outcome. I agree with the Adjudicator’s Opinion.

Ombudsman’s decision

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I find that the approach taken by Fidelity was reasonable in the circumstances of the transaction, with it involving both a BCE and FPC.

I also do not find that Mr L has suffered a financial loss. This is because had Fidelity initiated the sale on 13 March 2020, after granting an exception request for the screenshot of the FPC, the switch to cash should have taken place on 17 March 2020. Had this happened, Mr L would have received less than he did when the switch actually occurred.

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I do not uphold Mr L’s complaint.

Anthony Arter CBE Deputy Pensions Ombudsman 6 December 2023

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