Upheld: Service failures generally complaint against Scottish Equitable Plc, trading as Aegon

Decision detail

Summary

Mr I attempted to withdraw his pension funds from Aegon in July 2025 but experienced significant delays and service failures over three months. Aegon repeatedly rejected documents, sent expired verification links, and imposed shifting verification requirements. Most critically, on 1 October 2025, Aegon sent a partial payment of £6,329.87 using incorrect bank details by mixing the SWIFT code from Mr I's new overseas account with the account number from his previous bank. Although Mr I had confirmed his correct updated bank details in a phone call on 15 September 2025, Aegon's system failed to properly process this information. After Mr I complained about the misdirected payment, Aegon initially stated it would wait for the funds to be returned before issuing a new payment, then reversed this position and issued a corrected payment on 7 October 2025. The ombudsman upheld the complaint and awarded £500 compensation for the considerable distress, inconvenience, and service failures, rejecting Mr I's claim for £1,000 as the impact, while significant, lasted approximately three months rather than the longer period typically associated with higher compensation awards.

The Ombudsman's reasoning

The ombudsman found that while Aegon was required to conduct AML checks and use industry-standard verification procedures, it failed to provide consistently timely, accurate, and fair service. The critical failures included: (1) sending an incorrect verification link; (2) using incorrect bank details in the initial payment by mixing SWIFT code from one bank with account number from another, despite Mr I confirming correct details on 15 September 2025; (3) initially stating it would wait for return of misdirected funds before issuing new payment, then changing position; (4) technical inability to make international calls while staff misrepresented callback attempts; (5) communication difficulties exacerbated by time-zone differences and email-only contact. These failures caused considerable distress and inconvenience over approximately three months. While Mr I claimed the description of his country as 'high risk' caused serious offence warranting £1,000 compensation, the ombudsman found this did not rise to the level of serious offence or humiliation given the country had been removed from FATF grey list just years prior. The £500 award falls within the FOS guidance range for situations causing considerable distress, upset, worry, and significant inconvenience lasting weeks or months.

How this compares

Source

Read the original decision on the Financial Ombudsman Service website