Not upheld: Investment mis-selling complaint against Scottish Widows Administration Services Limited

Decision detail

Summary

Mr E complained that his pension fund had been mismanaged and that there should be protection against value decline as he approached retirement. His fund, managed under a Lifestyling strategy by Scottish Widows, increased by £14,000 between April 2021 and April 2022 but decreased by £10,000 between April 2022 and April 2023. The ombudsman found that the decrease was due to external market conditions (pandemic and Russian war effects) rather than mismanagement. The Lifestyling strategy was appropriately designed to provide stability through gradual shifts into lower-risk holdings, though it could not eliminate investment risk. The complaint was not upheld and no award was made.

The Ombudsman's reasoning

The ombudsman found that while Mr E was understandably frustrated with the pension fund drop, Scottish Widows did not cause the decline. The Lifestyling strategy was appropriately designed to provide stability as retirement approached by gradually shifting into lower-risk holdings such as bonds. However, the pension remained invested and subject to market fluctuations. The specific drop in value was attributable to external market conditions (pandemic and Russian war) rather than mismanagement. Scottish Widows provided appropriate information and resources to Mr E about his investment options.

How this compares

Source

Read the original decision on the Financial Ombudsman Service website