Refund of pension charges

DBTaxMan

Just received a large check out of the blue from a pension provider, refunding charges (plus interest) back from 2009 - broadly because I've not made any new contributions for several years.
Have heard on the news somewhere that the FSA are supposed to be investigating pension fund charges, but don't know what the details are - assume they are trying to preempt that?

Why are they refunding the charges to me, and not adding them to my pension? Surely they should be added to my pension fund as that's what the charges were paid out of?

Anybody know anymore about this?

Thanks

dunstonh

Have heard on the news somewhere that the FSA are supposed to be investigating pension fund charges

The food standards agency are not investigating pension fund charges. Nor is the financial conduct authority.

assume they are trying to preempt that?

unlikely. Several providers have found errors in unit pricing going back a few decades in some cases and are refunding the money where it didnt favour the customer but not taking it back where it did favour the customer.

Why are they refunding the charges to me, and not adding them to my pension?

Its easier to give it to you directly. Especially in cases where the pensions were transferred out years ago.

Surely they should be added to my pension fund as that's what the charges were paid out of?

If that is what you want then pay it into the pension yourself and get tax relief on it.

Anybody know anymore about this?

You havent mentioned the provider. So, its difficult to say if were have heard of an issue with your unknown provider. However, I am aware of Scottish Widows, Aviva and Old Mutual Wealth Life doing retrospective calculations.

zagfles

Did you use a financial adviser to buy the pension? Back in 2009 commission could be taken for the FA from your pension as part of the annual charge, ongoing every year, even if they did absolutely nothing after selling you the pension! See https://www.fca.org.uk/consumers/trail-commission This might ot might not have something to do with your refund.

DBTaxMan

Thanks both for the replies - really helpful in each case. I rather suspect you may be correct zagfles, the pension was taken out donkeys years ago when contracting out was vogue, and was taken out through an IFA.