Prudential Stole My Money!

geoffH

A couple of years ago I called Prudential to get the value of my pension. I discovered that in 2008 it had been transferred into a, 'cash fund' and so hadn't accrued any interest since then and I've lost over £30,000!

In 2008 I called the Prudential as I was thinking of cashing in my pension and wanted details of how to do it and the process. They said they would send forms but while they waited for their return they would transfer the entire fund into the cash fund for 30 days to protect its value against market variations. I agreed to this.

Later, I decided not to cash in my pension and did nothing further, expecting the funds to go back in the pension fund after the 30 days. Not so, it turns out.

During last year I've had much correspondence with the Prudential about this, in which they basically deny they mis-informed me, suggesting various interpretations of what was said. (I have a transcript of the 2008 conversation with the agent.)

I took the case to the Financial Ombudsman, a very inefficient service, who upheld the Prudential's position.

I'm now planning to go to court to recover what has now amounted to over £30,000! But will cost over £600 in court fees.

Wil I win??

Geoff H

Bantex_2

geoffH wrote: »

A couple of years ago I called Prudential to get the value of my pension. I discovered that in 2008 it had been transferred into a, 'cash fund' and so hadn't accrued any interest since then and I've lost over £30,000!

In 2008 I called the Prudential as I was thinking of cashing in my pension and wanted details of how to do it and the process. They said they would send forms but while they waited for their return they would transfer the entire fund into the cash fund for 30 days to protect its value against market variations. I agreed to this.

Later, I decided not to cash in my pension and did nothing further, expecting the funds to go back in the pension fund after the 30 days. Not so, it turns out.

During last year I've had much correspondence with the Prudential about this, in which they basically deny they mis-informed me, suggesting various interpretations of what was said. (I have a transcript of the 2008 conversation with the agent.)

I took the case to the Financial Ombudsman, a very inefficient service, who upheld the Prudential's position.

I'm now planning to go to court to recover what has now amounted to over £30,000! But will cost over £600 in court fees.

Wil I win??

Geoff H

What happened to the last 5 or 6 yearly statements they would have sent you?

kidmugsy

"Prudential Stole My Money!"

No they didn't; grow up.

atush

Why didn't you pick up the phone back in 2008 and just call them?

bmm78

geoffH wrote: »

I took the case to the Financial Ombudsman, a very inefficient service, who upheld the Prudential's position.

Wil I win??

What reasons did they give for rejecting the complaint? A court will not be held by a FOS decision, but the conclusion of an independent assessor like FOS should give you an idea of what is the likely outcome.

Based purely on the outline you have given though, I'm sorry to say the case looks very weak.

dunstonh

In 2008 I called the Prudential as I was thinking of cashing in my pension and wanted details of how to do it and the process. They said they would send forms but while they waited for their return they would transfer the entire fund into the cash fund for 30 days to protect its value against market variations. I agreed to this.

Seems logical and quite rightly the correct thing to do.

Later, I decided not to cash in my pension and did nothing further, expecting the funds to go back in the pension fund after the 30 days. Not so, it turns out.

So, you did nothing and thought that pru could read your mind?

I took the case to the Financial Ombudsman, a very inefficient service, who upheld the Prudential's position.

The FOS is there to rule on disagreements which cannot be resolved between you. In your case, there appears to be no wrongdoing. Each fund switch is a unique transaction. You agreed to a fund switch to cash but never gave the instruction to change that. As Pru are not discretionary investment managers for you, they have no right to fund switch without your authorisation. You are effectively complaining that they didnt break their regulatory permissions. A result that was always heading for rejection as you cannot expect a firm to break the rules and leave itself open to fines running into the millions.

I'm now planning to go to court to recover what has now amounted to over £30,000! But will cost over £600 in court fees.

And if you lose the case, they can come after you for costs. As the FOS is more consumer friendly than the courts and the onus in the court is for you to prove a breach of law, what exactly are you presenting as evidence?

How are you going to persuade a judge that Pru should have completed a fund switch without holding any permission from you and in breach of their regulatory permissions?
Pru did not have an adviser arm in 2008. So, are not in a position to give financial advice. Just options. They offered the option to move to cash. Which you agreed. What evidence do you have that you told them or they said they would move back in future?

I'm sorry, they did not steal your money. Unless you have evidence of an instruction that agreed for them to switch the fund back, then the ombudsman decision seems sound.

geoffH

Thanks for all your responses.

I should just clarify a couple things I left out so as to keep the info as brief as possible.

1. It wasn't until late 2012 early 2013 that I discovered the fund was still in the cash fund.

2. I'm sure I did get yearly statements but like most people, only skipped over them and year on year, a fund isn't likely to change significantly so wouldn't have noticed it was the same as the previous year.

3. I am grown up!

This is the actual words the agent said, "I just wanted to inform you that by issuing the retirement instruction form, the funds, your funds, will be switched to the cash fund so that we can guarantee your funds for 30 days"

So, my points being 1. If it was to remain in the cash fund forever, which it has, what is the reason for mentioning 30 days? 2. What happens after 30 days? 3. Why would I expect to have to go back to the Prudential to let them know I'd changed my mind, if I had reasonably assumed that after 30 days, the cash would revert back to the original fund?

The FOS interpretation of what the agent said was that it meant that the funds were being put in the cash fund to guarantee the value for 30 days. But really, the same points above apply and surely the only valid interpretation is mine in response to this five second statement at the end of a long phone conversation using much financial jargon some of which I didn't understand.

Any further thoughts?

Thrugelmir

geoffH wrote: »

I'm sure I did get yearly statements but like most people, only skipped over them and year on year, a fund isn't likely to change significantly so wouldn't have noticed it was the same as the previous year.

For such an important personal asset. I'm sure most people would take a few minutes to find their previous years statement and make a comparison.

Given you are seeking recompense to the tune of £30k. Surely something would have appeared amiss since 2008.

At the very least your annual statement would have said where your money was invested.

Dunnit

You still won't win.

Drp8713

No, they did what you asked.

Complaining about them not doing something that you didnt ask them to do is pointless, thus the FO decision.

Dont waste more money on court fees.

bmm78

geoffH wrote: »

This is the actual words the agent said, "I just wanted to inform you that by issuing the retirement instruction form, the funds, your funds, will be switched to the cash fund so that we can guarantee your funds for 30 days"

So, my points being 1. If it was to remain in the cash fund forever, which it has, what is the reason for mentioning 30 days? 2. What happens after 30 days? 3. Why would I expect to have to go back to the Prudential to let them know I'd changed my mind, if I had reasonably assumed that after 30 days, the cash would revert back to the original fund?

The FOS interpretation of what the agent said was that it meant that the funds were being put in the cash fund to guarantee the value for 30 days. But really, the same points above apply and surely the only valid interpretation is mine in response to this five second statement at the end of a long phone conversation using much financial jargon some of which I didn't understand.

Any further thoughts?

The act of cashing in the pension, and that of moving your funds into cash, are two separate transactions.

Although you chose not to proceed with the first one, this does not mean that they would then reverse the other transaction (even if they were able to do so without your permission).

If for argument's sake they were able to make the switch without consulting you, and had moved the funds back and then the value dropped, you would have legitimate grounds for compensation.

At the absolute worst it is a misunderstanding, but the liability for this is limited if they were not actually giving you advice on what you should do.