Upheld: Other regulated complaint complaint against EBS Pensions Limited

Decision detail

Summary

Mrs M complained that Embark failed to notify her of rent arrears on a property held in her SIPP and did not provide requested documentation despite repeated requests. The tenants stopped paying rent at the end of 2020, but Mrs M only discovered this in February 2022 after significant arrears accumulated. The ombudsman found that while the Property Management Agreement made Mrs M responsible for monitoring rent payments and notifying Embark of difficulties, Embark failed to provide timely information and should have ensured she had bank account access to perform her duties. Although Embark was not responsible for the arrears themselves, the service failures caused substantial distress and inconvenience. The ombudsman upheld the complaint and ordered Embark to pay £1,500 compensation, rejecting Mrs M's argument that this was insufficient given the months of frustration and Embark's continued unresponsiveness.

The Ombudsman's reasoning

The ombudsman found that while Embark failed to provide information promptly and did not support Mrs M adequately in recovering arrears, Embark was not responsible for the arrears themselves accumulating. Under the PMA, Mrs M as property manager held primary responsibility for monitoring rent payments, invoicing tenants, collecting rent, and notifying Embark of collection difficulties. The ombudsman found it likely Mrs M signed the PMA despite the unsigned copy, as commercial property acquisitions require legal formalities. However, Embark should have ensured Mrs M had access to the bank account as a matter of course to enable her to perform her duties. The service failures—delays in providing information and lack of support with recovery—caused substantial distress and inconvenience, particularly given Mrs M's status as a retired person dependent on her SIPP. The £1,500 compensation was appropriate for the distress caused over a sustained period, consistent with FOS guidelines for substantial upset and worry with serious disruption to daily life.

How this compares

Source

Read the original decision on the Financial Ombudsman Service website