Upheld: unsuitable pension transfer advice complaint against Thompson Cavendish Ltd
Financial Ombudsman decision DRN-6287827 of 2026-04-14T00:00:00+00:00. unsuitable pension transfer advice complaint against Thompson Cavendish Ltd. Outcome: Upheld.
Decision detail
| Reference | DRN-6287827 |
|---|---|
| Decision date | 2026-04-14T00:00:00+00:00 |
| Firm | Thompson Cavendish Ltd |
| Product | pension |
| Claim type | unsuitable pension transfer advice |
| Outcome | Upheld |
| Remedy | TCL must: (1) Compare actual performance of Mrs G's investments with notional value if they had remained with previous provider; (2) If notional value is greater, pay compensation equal to the difference plus interest; (3) Pay compensation into Mrs G's pension plan (adjusted for charges and tax relief) or if impossible, pay directly to her with 20% tax reduction (or 15% if tax-free lump sum available); (4) Pay £200 for distress and inconvenience; (5) Provide clear redress calculation details; (6) Pay within 28 calendar days or pay 8% simple interest per annum on any outstanding loss from deadline to settlement date. |
Summary
Mrs G sought pension advice from TCL in February 2024 after many years without review. TCL recommended transferring her two existing personal pensions (costing 1.28% and 1% annually) to a new provider costing 1.62% annually, primarily because the existing plans lacked drawdown flexibility. Mrs G's retirement income needs were poorly documented as 'as much as possible' at age 70-75, and TCL conducted no analysis of whether her existing pensions were on track to meet her needs. When Mrs G complained in October 2024 about feeling rushed and not understanding the advice, TCL defended its recommendation. The ombudsman upheld the complaint, finding the advice unsuitable because TCL failed to properly understand Mrs G's retirement needs before recommending a transfer to a more expensive arrangement, and that flexibility alone was insufficient justification for the switch. TCL must compensate Mrs G by comparing her actual investment performance against a notional value had she remained with her previous provider, plus £200 for distress and inconvenience.
The Ombudsman's reasoning
The ombudsman found the advice unsuitable because TCL failed to properly understand Mrs G's retirement needs before recommending a transfer to a more expensive pension. Without understanding her required retirement income and capital needs, TCL could not reasonably determine that flexibility was necessary or that the transfer was in her best interests. The transfer was justified solely on the basis that the existing plans lacked drawdown features, which alone is insufficient. The ombudsman noted that TCL's own testimony confirmed no income analysis discussion occurred, no comparison illustrations were provided, and Mrs G's attitude to risk assessment was not properly grounded in her actual circumstances. The ombudsman rejected TCL's argument that flexibility was the key driver, finding instead that TCL should have either waited until Mrs G's retirement needs were clearer or advised her to retain existing arrangements.
How this compares
| Group | Decisions | Uphold rate |
|---|---|---|
| Thompson Cavendish Ltd, all decisions | 2 | 100% |
Source
Read the original decision on the Financial Ombudsman Service website