Help - IFA appears to have transferred pension pots without written consent

dunstonh

Thank you 🙏🏻 And thank you also for taking the time to help me understand all this  The IFA said OMW had told him that out of 19 companies they had done a transfer for (that day?) only RL didn't need a signature. Him getting caught out with the new software process makes sense, from our conversation. 

I'm calling BS.  It is also ironic that OMW themselves don't require a signature when leaving them.   

 and in the meantime all the financial parties felt it acceptable to instigate, request and release my £200k without my express consent. 

Correct.  Because the adviser said he had consent.   

 Whoever is at fault (and I fully understand the IFA made the first error) there should be security checks that avoid this from happening. 

The fault is no longer in question.  Neither OMW or RL were at fault.   Only one person was at fault and that was the adviser or the person that did it for the adviser (which by default still means the adviser).

 FGS, I have to sign into a portal, receive a code to my mobile and enter that into my pc before I can even read an email to tell me they've rebranded!! That's how security conscious they are to protect your information. Yet a software request with no proof, or even check, of customer signature is taken as security stringent enough to release my funds?!!

Not comparable.   Two-factor authentication is increasingly common for internet users because of the level of fraud that occurs via the internet.    Transferring pensions requires the involvement of regulated/approved individuals trusted to do the job with legal declarations completed that they have the authority to do so.

 I've spoken to several non-financial but well-educated people, and every one of them is astounded by this.

Low knowledge individuals, in respect of investments and pensions, are not a good source of reliable information.  I am sure in their occupations there are things done that would surprise outsiders too.

As a customer it is "simple black and white". RL have been trusted to hold and invest my money and have released it to another company without requesting, or checking in any way for, my consent. I'll wait to see what they have to say. 

Hopefully, it will be a  complete rejection of your complaint and refer you back to the adviser as the one responsible.   However, they may decide to uphold the complaint and apologise but that will just be a paper apology.  It won't change anything.    In either case, they may well pay a small goodwill gesture.  

For someone that is completely aghast at what has happened, you have a very laid back attitude towards the one individual/company that actually broke the rules and completed a false declaration about you.

cloud_dog

It appears the IFA will have gotten out of this fiasco really quite lightly, despite the evidence.

cfw1994

cloud_dog said:

It appears the IFA will have gotten out of this fiasco really quite lightly, despite the evidence.

Agreed.
As scdandem reminded us

I persist in blaming 'the process' that RL employ, which has allowed me, their customer, for whom they have a duty of care, in this unprotected situation, after, as you can see, only an exploratory conversation with an IFA. 

Re-read that.  You had a conversation with this IFA, to whom you had

given him copies of passports, licences, bank details and NI numbers ready to go ahead once we got the pension paperwork

He was the one who instigated the transfer.   End of story.   RL followed the process to the letter, & did nothing wrong.

Have you raised a complaint against this IFA?   
If not, I really think you should.   They have let you down badly (& lied about the Origo Options process too, as dunstonh has clarified).   
You claim to not even have them formally as your IFA, yet they have taken enough information to impersonate you, and by all accounts (albeit not to their gain, of course), they did just that - without your explicit approval.

(oh, & thx for the hint on quoting, dunstonh, my first use right here   

scdandem

I'm calling BS.  It is also ironic that OMW themselves don't require a signature when leaving them.   

Noted. It is sounding more and more like BS. It's difficult to argue a point as an outsider to the process.

Correct.  Because the adviser said he had consent.  

So do you think at some point during the process the IFA has indicated that the forms have been signed? He told me that due to Covid accounts are being set up at an earlier stage, before signed paperwork is received, and that he didn't realise OMW had requested the money. BS again?

Not comparable.   Two-factor authentication is increasingly common for internet users because of the level of fraud that occurs via the internet.    Transferring pensions requires the involvement of regulated/approved individuals trusted to do the job with legal declarations completed that they have the authority to do so.

Fair enough.

Low knowledge individuals, in respect of investments and pensions, are not a good source of reliable information.  I am sure in their occupations there are things done that would surprise outsiders too.

Of course they're not, and would never dream to offer it. However my frustration is around the treatment as a customer of RL. That they did not protect me as their direct customer. That their processes (whether or not universally acceptable internally within the industry) have not protected me as their customer. I think it fair, as a customer, to assume that my money was safe with them until I said otherwise? Should I worry that my ISA is at risk too if I happen to think out loud about moving to another provider in earshot of someone who can access that system? Clearly there was more to it than thinking out loud in this situation, but still, where is the protection for the customer?

For someone that is completely aghast at what has happened, you have a very laid back attitude towards the one individual/company that actually broke the rules and completed a false declaration about you.

It appears the IFA will have gotten out of this fiasco really quite lightly, despite the evidence.

You're both absolutely right on this one. I did make my feelings very clear with the IFA over the phone, both about what has happened and the overall "less than independent" service he has provided. He is in no doubt that once everything is reversed, and we can see that we are not disadvantaged financially, we will be taking a breath before even considering our next move. I find choosing the right path for investments and pensions very daunting and was comforted when this IFA came highly recommended at a point when we needed to make some big decisions. For him to have done what he has, albeit in error(?) puts me in a difficult situation as he was recommended to my by one of my own clients, who has been happy with his services for many years. For the sake of my own client relationship, having shown my displeasure, I'd rather just reverse things and walk away from him, which I fully intend to do. 

But then what? Finding good, impartial advice seems almost impossible. I've learned a huge amount about DIY recently and that is probably the path I will take, but part of me wants to hold onto the relationship with this adviser(!) just so that I don't feel quite so cast adrift.

Malthusian

There are over 5,000 advisers in the UK. Quite a few have probably made the error of clicking "proceed" on a certain provider's web interface without realising it meant "start the transfer process" rather than "print the forms for the client to sign". (As Dunston said, it's surprisingly easily done.) The number that have turned a cluck-up into a conspiracy by trying to shift blame onto the ceding provider, the one entity in the chain that is least to blame, can probably be counted on the fingers of one hand.

You are free to DIY if you are confident in your ability to manage your own money and don't feel that you would get any value from paying for advice, but a very random failure by a single IFA would be a strange reason to do it.

You can follow the same process that you would have if your client had said "sorry, don't know any IFAs". Ask around for more recommendations, or go to a directory, find a few firms in your area, and have a beauty parade.

I honestly can't understand wanting to hold onto the relationship with the old adviser when it should be easy to find a new one. (By easy, I mean that people with zero financial knowledge manage it all the time.) The problem is not so much the fat-finger error but the disassembling afterwards. I can even feel a very limited amount of sympathy with the adviser trying to cover it up - another client might have not bothered to check their explanation on an Internet forum, waited for their funds to be transferred back to Royal London, and said "no harm no foul". But you did check, so here we are. You can't stuff that toothpaste back into the tube.

dunstonh

So do you think at some point during the process the IFA has indicated that the forms have been signed? He told me that due to Covid accounts are being set up at an earlier stage, before signed paperwork is received, and that he didn't realise OMW had requested the money. BS again?

BS again but with an element of truth.     There has been some relaxing of physical papers not being required with some providers because of Covid but the origo system is unchanged.     For example, pre-covid, a number of providers would require the IFA to post the papers to the provider, who would then scan them and upload onto their systems.  They are now allowing the IFAs to upload scanned copy onto the systems.    
OMW, on the old system pre-covid, would require the IFA to either post the declarations, expression of wish etc or you could email it to them.    They wouldn't start it until they had the signed transfer authority.     On the new system, they dont need that transfer authority unless its a non-origo provider.   So, maybe he was not aware of the changes.  New systems can confuse people when using them for the first time.   But it still seems strange to press submit on the business when you haven't done any analysis.  Also, it is mandatory on new business for the report to be issued prior to submitting the new business.  You have to give your consent to proceed.  Then there are things like the fee agreements.  Those need to be signed (can be done with electronic sig).  

However my frustration is around the treatment as a customer of RL. That they did not protect me as their direct customer. That their processes (whether or not universally acceptable internally within the industry) have not protected me as their customer. I think it fair, as a customer, to assume that my money was safe with them until I said otherwise?

RL are also under a duty to transfer the pension as quickly as possible and timescales are monitored.  If they delayed, unit prices would change which could cause material losses.   And, without meaning to labour on the point, the adviser, who is a regulated individual completed a declaration stating they had your permission.  Your money was safe either way as only genuine trusted companies can use the origo system.   

Should I worry that my ISA is at risk too if I happen to think out loud about moving to another provider in earshot of someone who can access that system? 

Theoretically yes. (accepting the earshot bit is tongue in cheek.  However, ISAs can be transferred without signature).

but still, where is the protection for the customer?

The protection is the regulated complaints process if the adviser firm fails to sort it out to your satisfaction.  This adviser is responsible for you not being out of pocket.       Ultimately, there are the courts.   The adviser has declared things were agreed and completed that were not true.  They wouldn't have a leg to stand on with their current stance.   Whereas the honest response of "whoops, I ballsed up, let me put it right" would have been forgivable. 

xylophone

disassembling afterwards.

 Going to pieces?  

Malthusian

Whereas the honest response of "whoops, I ballsed up, let me put it right" would have been forgivable. 

Probably forgiven as well.

Adviser: "Mea maxima culpa. The pension transfer system universally used across the industry allows us to transfer pensions without your signature if we declare you gave consent. In normal circumstances this would of course only happen after you signed the forms. However in this case, I / my assistant accidentally pushed the button that said we had your consent when we thought we were just printing the forms."

Scdandem: "That's absolutely ridiculous. What a ludicrous system. It's disgraceful you should have been able to transfer my money without my signature." (i.e. exactly what they said in this thread)

Adviser: "I agree, but that's how the modern pension system works, and it was me that pressed the wrong button on it, so here's compensation for your time out of the market."

Scdandem: "Although I'm still p-ed off about how the system works, at least I have an honest adviser who fesses up to mistakes, especially as the pension system is so reliant on the assumption that everyone with regulated status is honest."

But Scdandem doesn't have an honest adviser so here we are.

It is worth noting that this is how it worked long before advisers gained the ability to authorise transfers directly. Before, Adviser would have sent some forms signed by Client to Insurer A. Insurer Drone 1 would have opened the envelope and scanned the post onto the system. Insurer Drone 2 would have verified the signature, and sent a message to Insurer Drone 3 in the transfers team saying "Client has approved the transfer of his pension to Insurer B". Drone 3 duly fills in Insurer B's bank details, presses the button and the pension is transferred. The important thing to note here is that from Scdandem's perspective, the insurer has seen the signed consent and transferred the pension, but Drone 3 who handles the transfer of the money has never seen Client's signature, they are relying on the information sent to them by Drone 2, who has only seen an electronic copy of what was scanned by Drone 1.

All that has happened with the new system is that Adviser has replaced Drone 1. As Dunston has said, the whole system relies on people working for regulated companies being honest and making correct declarations. But it always did. Just that now, Drone 3 is willing to trust Adviser's declaration that the client has consented instead of trusting Drone 2's declaration.

dunstonh

 The important thing to note here is that from Scdandem's perspective, the insurer has seen the signed consent and transferred the pension, but Drone 3 who handles the transfer of the money has never seen Client's signature, they are relying on the information sent to them by Drone 2, who has only seen an electronic copy of what was scanned by Drone 1.

Not forgetting that a lot of people have pensions where they have never provided their signature at all in the opening phase.  So, there would be nothing to verify against in those cases.

scdandem

But Scdandem doesn't have an honest adviser so here we are.

To be fair, I did say that he'd contacted me late the same evening to say:

"I am replying to you this late to put your mind at rest. The monies due to an admin error are on the way to old mutual and is fully reversible.

I will speak to you in the morning as to wether you wish to allow the monies to remain with Old Mutual or be sent back to Royal London at no cost. 

Hope this puts your mind at rest. I will call you in the morning. "

He called at 9am on the dot and explained what had happened and said there was absolutely no problem reversing the matter and he was more concerned that as a client I would think he normally operated like that, as it wasn't the case etc. and was especially concerned as I'd come recommended from a shared client. He then emailed an hour later with a copy of OMWs internal email confirming the reversal. It was then he told me about the 19:1 signatures. He said it was an error and said he took my comments on the chin and wanted to make sure everything was ok. 

Grounds for forgiveness?