Not upheld: service failure, administrative errors, complaint handling complaint against Phoenix Life Limited (trading as Standard Life)

Decision detail

Summary

Mr W, an existing Standard Life customer of over 20 years, complained about three issues with his application to open an Active Money Personal Pension (AMPP) in April 2025: (1) being required to provide identity verification documents despite his existing customer status; (2) his initial £1 contribution being incorrectly applied to his stakeholder pension; and (3) critical application emails being sent to an incorrect email address on three occasions, causing delays and inconvenience. Standard Life acknowledged the errors and paid £300 in compensation. Mr W sought an additional £200, arguing he had suffered financial loss through lost fund growth and tax relief, and stress-related health impacts. The ombudsman found the identity verification requirements were reasonable regulatory obligations, that Mr W had not suffered quantifiable financial loss as he could have proceeded with another provider, and that the £300 compensation was fair and proportionate for the non-financial distress and inconvenience caused by the repeated administrative errors.

The Ombudsman's reasoning

The ombudsman found that while Standard Life made multiple errors (incorrect email address on three occasions and misapplication of the £1 contribution), these did not result in quantifiable financial loss to Mr W. The identity verification requirements, though administratively burdensome for an existing customer, were reasonable and proportionate under KYC and AML regulations. Mr W was informed during his initial call that identity checks would be required. Although the email errors caused an 11-day delay, this was not significant enough to have prevented Mr W from ultimately establishing the AMPP had he chosen to proceed. The ombudsman concluded that the £300 compensation already paid was appropriate for the non-financial losses (distress, inconvenience, disappointment, and loss of expectation) caused by the repeated small errors, falling within the FOS guidance band for such situations.

How this compares

Source

Read the original decision on the Financial Ombudsman Service website