Problem with LGPS AVCs with Prudential

bioboybill

I mentioned some of this on another person’s thread previously, but thought I would start my own, so I could raise a couple of my own questions.

Basically I am a long-standing member of a LGPS and I’m hoping to retire at the end of October 2022 when I am 60 and have 85 year rule protection on all my final salary years. Just over 3 years ago I started putting money into the fund’s in-house AVC scheme which is run by Prudential. The idea is to take the tax free lump sum from the AVC and add to my final salary lump sum to get me through to 67 when added to my DB pension. A couple of times I have noticed that the deductions from my salary didn’t go into the fund for a month or two, but when I contacted Prudential online they corrected matters. 

In late December I noticed that my £600 a month contributions for the last 3 months  were not showing in my account, so checked with our payroll and they showed me the payments were sent through. I contacted the Pru online and they assured me it was a web migration issue and that it would be corrected urgently. That was 4 weeks ago. Since then another £600 has gone from wages but not shown up on my account.

A search on Trustpilot and their FB page shows plenty of other people with exactly the same issue, with some people missing contributions for 5 months, and others being fobbed off for 8 months after retiring and still not getting their money. People are being promised money by Friday, by next week, by the end of the month and it never shows up. Others are missing lump sum contributions and being told by CS that they don’t know where the money is! There are even terminally ill people being messed about. It’s totally shocked me that a well known company like the Pru can be allowed to operate in this manner, and this is a company obviously being trusted by my pension fund and recommended to members.

At the moment all I have is a letter saying they hope to sort my case within 8 weeks and then I can go to the Financial Ombudsman Service, but the FOS take another 3 months minimum to look at your case, so that’s 5 months gone already. My poor review on Trustpilot resulted in an email from the Pru’s  Social Media Manager saying I had been treated badly and he would liaise with complaints to sort it out, but it’s clear from seeing what has happened so far (nothing) and from comments from people he said he would help previously that this is just managing their public image and nothing gets done. I have approached my pension fund administrators last week and they said a number of members had contacted them with the same issue, so they would be raising it with the Pru.

I guess the main questions are: 1. Should I be really worried about this? 2. Are the Pru in financial difficulty. 3. How is a supposedly regulated company allowed to behave like this? 4. Could this impact on me getting my DB pension and AVC lump sum when I retire, since payment of the AVC lump sum can only be taken at the same time as the DB pension? 5. Is there anything else I could do to sort this out?

John1965

Exact same problem. I contacted Prudential in Dec. as I noticed that there had been no payments to my AVC since Sept. I was assured that there was nothing to worry about and it was due to a new system and would be sorted by mid Feb. Looking at Trustpilot I fear I was fobbed off when I called in Dec. I am now missing £600 in my AVC and there seems to be widespread problems with customers trying to access their savings. If this isn't sorted soon I will pause any further payments but this is a shocking way for a company to behave. Why isn't the Ombudsman all over this given this seems to have been going on since early last year?

jamjar92

I too have raised a complaint, October payment and nothing since. I was told also this should be resolved Mid to End of Feb with the people who raised a complaint being sort first. They told me the payments will be backdated so I will not miss out if the funds have increased.

bioboybill

1. I would not worry about it.

2. There is no evidence to support that, so no.

3. I think there been a lot of migration issues of the data from various old systems to the new one. They are aware and this as been communcated to me from Pru, My Payroll and our AVC intermediary

4. It will be backdated, so units purchased at the price on the date when should have been posted to the account. This does not affect the DB in anyway, AVC is a DC-Pot to be taken along side the main DB, the value will not be affected by the delay in posting to the account. It will be resolved well before Sept 2022.

5. Sit tight.

John1965

I would not stop your payments you be missing out on the tax saving, potential growth, and NI saving if it a SSAVC scheme, as all payment are being backdated.

I logged on the mypru tonight and the Novembers payment as been posted dated 30 Nov, with appropiate AMC in force at the time and it now increased in value using todays units prices. So I expect Dec/Jan's to be posted soon.

OldBeanz

bioboybill said:

I mentioned some of this on another person’s thread previously, but thought I would start my own, so I could raise a couple of my own questions.

Basically I am a long-standing member of a LGPS and I’m hoping to retire at the end of October 2022 when I am 60 and have 85 year rule protection on all my final salary years. Just over 3 years ago I started putting money into the fund’s in-house AVC scheme which is run by Prudential. The idea is to take the tax free lump sum from the AVC and add to my final salary lump sum to get me through to 67 when added to my DB pension. A couple of times I have noticed that the deductions from my salary didn’t go into the fund for a month or two, but when I contacted Prudential online they corrected matters. 

In late December I noticed that my £600 a month contributions for the last 3 months  were not showing in my account, so checked with our payroll and they showed me the payments were sent through. I contacted the Pru online and they assured me it was a web migration issue and that it would be corrected urgently. That was 4 weeks ago. Since then another £600 has gone from wages but not shown up on my account.

A search on Trustpilot and their FB page shows plenty of other people with exactly the same issue, with some people missing contributions for 5 months, and others being fobbed off for 8 months after retiring and still not getting their money. People are being promised money by Friday, by next week, by the end of the month and it never shows up. Others are missing lump sum contributions and being told by CS that they don’t know where the money is! There are even terminally ill people being messed about. It’s totally shocked me that a well known company like the Pru can be allowed to operate in this manner, and this is a company obviously being trusted by my pension fund and recommended to members.

At the moment all I have is a letter saying they hope to sort my case within 8 weeks and then I can go to the Financial Ombudsman Service, but the FOS take another 3 months minimum to look at your case, so that’s 5 months gone already. My poor review on Trustpilot resulted in an email from the Pru’s  Social Media Manager saying I had been treated badly and he would liaise with complaints to sort it out, but it’s clear from seeing what has happened so far (nothing) and from comments from people he said he would help previously that this is just managing their public image and nothing gets done. I have approached my pension fund administrators last week and they said a number of members had contacted them with the same issue, so they would be raising it with the Pru.

I guess the main questions are: 1. Should I be really worried about this? 2. Are the Pru in financial difficulty. 3. How is a supposedly regulated company allowed to behave like this? 4. Could this impact on me getting my DB pension and AVC lump sum when I retire, since payment of the AVC lump sum can only be taken at the same time as the DB pension? 5. Is there anything else I could do to sort this out?

8 weeks in and they haven't replied to my complaint at all .

bioboybill

jamjar92 said:

I too have raised a complaint, October payment and nothing since. I was told also this should be resolved Mid to End of Feb with the people who raised a complaint being sort first. They told me the payments will be backdated so I will not miss out if the funds have increased.

bioboybill

1. I would not worry about it.

2. There is no evidence to support that, so no.

3. I think there been a lot of migration issues of the data from various old systems to the new one. They are aware and this as been communcated to me from Pru, My Payroll and our AVC intermediary

4. It will be backdated, so units purchased at the price on the date when should have been posted to the account. This does not affect the DB in anyway, AVC is a DC-Pot to be taken along side the main DB, the value will not be affected by the delay in posting to the account. It will be resolved well before Sept 2022.

5. Sit tight.

John1965

I would not stop your payments you be missing out on the tax saving, potential growth, and NI saving if it a SSAVC scheme, as all payment are being backdated.

I logged on the mypru tonight and the Novembers payment as been posted dated 30 Nov, with appropiate AMC in force at the time and it now increased in value using todays units prices. So I expect Dec/Jan's to be posted soon.

Thanks for your reply. I understand that you have been given reassurances that things will be put right this month, but reviews on Trustpilot and FB and news going back to October 2019 shows people being made similar promises and up to 8 months later still getting nowhere. In the news were cases of people being retired and still having no access to their money. This included a colleague at my workplace who took early retirement last July and still has no money from the Pru. For me their reassurances mean very little when I can see they are not making good on promises. I don’t know how the Financial Ombudsman is allowing this. I know that the Pru got fined £24m for mis-selling annuities about 18 months ago, so they have form. It’s not just AVCs but right across their business.

bioboybill

And as if by magic my contribution from end of November appeared in my account this morning dated 4th December, so only £1200 missing now.

jamjar92

bioboybill said:

And as if by magic my contribution from end of November appeared in my account this morning dated 4th December, so only £1200 missing now.

I only had the issue since Nov 2020, previously in the old portal it worked just fine. They had lots of old systems for different types of client I believe, this new one brings them all together, probably easier for them to support and more cost effective going forward.

Under normal process, November payments, Pru only get at the end of the month regardless of the payroll date. They have 10 days to post to the account, so 4 Dec is within this limit.

bioboybill

My pension fund administration manager said that irrespective of any web issue they are breaking the Service Level Agreement with the pension fund. Under the SLA the money must be invested within 28 days of being decucted from wages. He told me they will be complaining at the highest level. There is no way that somebody who retired in July should be waiting for payment the next February.

OldBeanz

I spoke to them today about the wife's ongoing issues since the end of September. They will raise a complaint and she is due a reply in 5 days as it is now 'a complaint' - they haven't picked up on my online complaint from December.
They now appear to be wanting to take this on the chin by making sure that no one misses out - in essence they indirectly admitted it was an issue. So they will backdate any contributions to the relevant dates. They were keen to know if we had lost out financially. With the wife's contributions, she has now reached the stage where she cannot pay all her contributions from salary this year so we will see how that works out. 
One wonders why they upgraded a system in the middle of having restricted staff available when the new site does not appear to offer anything new.

AlanP_2

One wonders why they upgraded a system in the middle of having restricted staff available when the new site does not appear to offer anything new.

It might be an underlying technology / infrastructure issue has forced the change. We have had to migrate a few old applications to more modern solutions recently as underlying versions of Windows and database software were un-supported and hence security risks whilst the applications themselves couldn't run on newer versions.

Rock & Hard Place, and benefit to user a total side issue in reality.

bioboybill

They are great at admitting that you have been treated unfairly and promising to put it right urgently, but then they do nothing. It’s all about fobbing you off in my experience and that of many others. Don’t hold your breath waiting for them to contact you or your wife in 5 days, Old Beanz.