Not upheld: administrative error - wrongful account closure complaint against Nucleus Financial Services Limited
Financial Ombudsman decision DRN-6326080 of 2026-05-20T00:00:00+00:00. administrative error - wrongful account closure complaint against Nucleus Financial Services Limited. Outcome: Not upheld.
Decision detail
| Reference | DRN-6326080 |
|---|---|
| Decision date | 2026-05-20T00:00:00+00:00 |
| Firm | Nucleus Financial Services Limited |
| Product | pension |
| Claim type | administrative error - wrongful account closure |
| Outcome | Not upheld |
| Remedy | Nucleus has already paid £300 compensation for distress and inconvenience and credited £831.78 for lost investment growth to Mr W's pension account. No further remedy is required. If Mr W requests a breakdown of the £831.78 calculation, Nucleus must provide it without further delay. |
Summary
Mr W complained that Nucleus Financial Services Limited mistakenly closed his entire pension account (valued at approximately £70,000) instead of processing only a tax-free cash withdrawal on 3 September 2025. The error triggered an automated taxable income payment for the entire account balance, causing Mr W significant distress when he discovered the account missing from his online view on 18 September. Nucleus identified the error, stopped the physical payment issuance, repurchased the sold assets, and calculated that Mr W had lost £831.78 in investment growth, which it credited to his account on 21 October, along with £300 compensation. The ombudsman upheld Nucleus' position, finding the compensation appropriate and the rectification methodology fair, and declined to award additional compensation despite Mr W's concerns about the account's temporary disappearance from his online view.
The Ombudsman's reasoning
The ombudsman found no basis to doubt Nucleus' explanation that human error caused the wrong instruction to be coded. While the account's disappearance from the online system caused Mr W concern about potential theft, the ombudsman understood this was likely due to a trading block Nucleus places on SIPPs during fund sell-downs to prevent conflicting trades. The key issue was ensuring Mr W was restored to his original position, which Nucleus achieved by recalculating and crediting the lost investment growth. The £300 compensation was appropriate for a single mistake requiring reasonable effort to resolve with impact lasting several weeks, fitting within the ombudsman's standard award brackets.
How this compares
| Group | Decisions | Uphold rate |
|---|---|---|
| Nucleus Financial Services Limited, all decisions | 2 | 0% |
Source
Read the original decision on the Financial Ombudsman Service website