Not upheld: unsuitable pension transfer advice complaint against Harbour Rock Capital Limited

Decision detail

Summary

Mr D complained that Harbour Rock Capital Limited gave unsuitable advice leading him to transfer his defined benefit occupational pension to a SIPP and withdraw all funds. Harbour Rock initially recommended against the transfer in August 2021, but Mr D signed an insistent client form to proceed. After delays in the transfer process, Mr D's circumstances changed dramatically in August 2022 when he faced potential loss of his home due to divorce proceedings and needed funds to buy out his ex-partner. Harbour Rock issued further suitability reports and recommended a specific withdrawal amount, but Mr D ultimately withdrew the entire £118,103.08 transferred amount. The ombudsman found that while Harbour Rock's process had failings, Mr D would have transferred and withdrawn the funds anyway given his desperate circumstances and lack of alternative funding sources, making it unlikely that proper advice would have changed his decision.

The Ombudsman's reasoning

The ombudsman acknowledged that Harbour Rock's insistent client process was flawed and the advice lacked detail. However, the key issue was whether Mr D would have transferred his pension anyway if Harbour Rock had properly followed procedures and given comprehensive advice. The ombudsman found that Mr D's circumstances were so desperate—facing imminent loss of his home with no savings and no alternative sources of funds—that he would have transferred regardless of how well Harbour Rock conducted the process. The ombudsman noted that Mr D was adamant about accessing the funds, understood he was going against Harbour Rock's advice, and was not someone who would have accepted contrary advice once the threat of eviction became imminent. The ombudsman concluded that at that point, proceeding with the transfer may have been the best advice available, as there was no other way for Mr D to obtain the required funds.

How this compares

Source

Read the original decision on the Financial Ombudsman Service website