Upheld: Account administration errors complaint against EBS Pensions Limited
Financial Ombudsman decision DRN-4718714 of 2024-05-22T00:00:00+00:00. Account administration errors complaint against EBS Pensions Limited. Outcome: Upheld.
Decision detail
| Reference | DRN-4718714 |
|---|---|
| Decision date | 2024-05-22T00:00:00+00:00 |
| Firm | EBS Pensions Limited |
| Product | Pension |
| Claim type | Account administration errors |
| Outcome | Upheld |
| Remedy | Embark must: (1) Calculate the loss by obtaining the notional value of Mr M's pension based on it being invested in W's 'MPS balanced' portfolio from 12 July 2023, then subtract the current pension value; (2) Pay any loss as a lump sum directly to Mr M after making a notional tax deduction of 15% (if Mr M has remaining tax-free cash entitlement) or 20% (if no tax-free cash entitlement remains); (3) Pay Mr M £100 compensation for distress and inconvenience caused by the error and subsequent customer service failures. |
Summary
Mr M requested that Embark transfer his SIPP holding from provider P to provider W. On 12 July 2023, Embark received the £1.2m holding but mistakenly transferred it to provider F instead of W. Mr M notified Embark of the error within 30 minutes, but the funds were not deposited with W until 21 July 2023, resulting in a loss of £28,990.68 in missed investment growth. Embark admitted the error but failed to substantively respond to Mr M's evidence of loss or to the ombudsman's investigator findings. The ombudsman upheld the complaint and ordered Embark to compensate Mr M for the financial loss (calculated using a specified methodology with tax adjustments) plus £100 for distress and inconvenience.
The Ombudsman's reasoning
The ombudsman found that Embark admitted to making an administrative error by sending funds to the wrong provider, which caused a delay in investment. Since the delay was entirely Embark's fault, the firm should compensate Mr M to place him back in the position he would have been in had the error not occurred. The ombudsman adopted the investigator's recommended loss calculation method: determining the notional value of the pension had it been invested with W from 12 July 2023 and subtracting the current value. The ombudsman also noted Embark's failure to respond substantively to the complaint and investigator's findings, which constituted additional customer service failures.
How this compares
| Group | Decisions | Uphold rate |
|---|---|---|
| EBS Pensions Limited, all decisions | 15 | 40% |
| Account administration errors, all decisions | 25,844 | 25% |
| Pension, all decisions | 15,579 | 47% |
Source
Read the original decision on the Financial Ombudsman Service website