Upheld: unsuitable pension transfer advice complaint against Carnwyllon Wealth Management Limited
Financial Ombudsman decision DRN-6278476 of 2026-04-30T00:00:00+00:00. unsuitable pension transfer advice complaint against Carnwyllon Wealth Management Limited. Outcome: Upheld.
Decision detail
| Reference | DRN-6278476 |
|---|---|
| Decision date | 2026-04-30T00:00:00+00:00 |
| Firm | Carnwyllon Wealth Management Limited |
| Product | pension |
| Claim type | unsuitable pension transfer advice |
| Outcome | Upheld |
| Remedy | CWML must: (1) Compare the performance of Mr M's investment with a benchmark of 50% FTSE UK Private Investors Income Total Return Index and 50% average rate from fixed rate bonds from the date of investment to the date of final decision; (2) Pay compensation equal to any shortfall between actual value and fair value; (3) Pay the compensation into Mr M's pension plan (adjusted for charges and tax relief) or, if not possible, pay directly to Mr M with a 20% notional tax reduction (or 15% if a tax-free lump sum was available); (4) Pay £200 for distress and upset caused; (5) Pay 8% simple interest per year on any unpaid compensation from 28 days after acceptance of the decision. |
Summary
Mr M, aged 46 with a personal pension of £104,551 and low investment knowledge, sought pension advice from CWML in 2017. CWML recommended transferring his pension to a different provider offering guaranteed drawdown features, citing Mr M's stated desire for guaranteed income. However, the ombudsman found the advice unsuitable because: (1) CWML failed to adequately investigate whether a guaranteed income was a genuine need or merely a preference 20 years before retirement; (2) the fact-find was incomplete, lacking crucial information about Mr M's financial circumstances and retirement needs; (3) the new pension had significantly higher costs (1.8-1.9% plus 0.5% advice fees plus 4% upfront versus 1.45% existing) without justification; (4) the pension illustration was based on an incorrect retirement age of 75 instead of the discussed age of 65, preventing informed comparison; and (5) Mr M was not given sufficient information to make an informed decision. The ombudsman upheld the complaint and ordered CWML to compensate Mr M based on a benchmark of 50% FTSE UK Private Investors Income Total Return Index and 50% fixed rate bonds, plus £200 for distress.
The Ombudsman's reasoning
The ombudsman found that while Mr M expressed an interest in a guaranteed income, CWML failed to adequately investigate whether this was a genuine need or merely a 'nice to have' 20 years before retirement. The fact-find was incomplete, lacking crucial information about Mr M's assets, liabilities, financial dependents, and retirement income needs. The new pension came at significantly increased cost (1.8-1.9% plus 0.5% advice fees plus 4% upfront versus 1.45% existing) without justification based on Mr M's actual needs. The illustration provided was based on an incorrect retirement age (75 instead of 65), preventing Mr M from making an informed comparison. Mr M's attitude to risk (4/10) indicated willingness to take some risk, inconsistent with CWML's characterization of the new product as having 'virtually no risk'. Without evidence of thorough analysis of Mr M's circumstances and needs, the recommendation could not be shown to be suitable or in his best interests.
How this compares
| Group | Decisions | Uphold rate |
|---|---|---|
| Carnwyllon Wealth Management Limited, all decisions | 2 | 75% |
Source
Read the original decision on the Financial Ombudsman Service website