Transfer Advice Complaint - Do I have a leg to stand on here?

michael1234

Hello All

I recently transferred my DC pension that had some guarantees which meant I needed to take advice to do so (technically it was classed as a DB for transfer purposes but in reality it was a pension consisting of several normal funds that I could buy and sell at will). I paid for the advice and the transfer went ahead.

Unfortunately the sale took place in early April and given most of the funds had a high reliance on American stocks, I lost about 10% of its value within a week or so. The day the sale took place was Trump's Tarif Day and stocks sunk and then recovered in quick succession. The sale took place at the bottom of the sharp V. I was not able to buy back into the market until the transfer completed which was weeks later.

Obviously the advice had statements about market performance can go up and down but nothing about the specific risk of getting out of the market and then back in at a later date - selling up and then buying in again.

So, even though I'm still very sore about this, given the transfer FA completed the transfer successfully I would feel a bit guilty about lodging a speculative complaint. I would never dream of complaining about something going wrong as a result of losing Defined Benefits. But then I thought its free to try and it seemed to me 99% of the advice was about losing the DB benefits and not a lot else when there are clearly other risks. I barely realised that the stocks would be sold at all as for most of the lead up period I'd assumed it would be like an ISA where the stocks just move to a new provider.

Anyway, I suspect I haven't a leg to stand on but the finances are such even a 1% chance might be worth trying?

Thanks for reading and I would be very grateful for any replies from either people who are/have worked in the pensions or financial industry or people who have related experience to share and nobody else.

DRS1

Was an in specie transfer possible?
Did someone advise you NOT to do it?

HappyHarry

Oh my giddy aunt.

If any new posters asks why DB transfers are so expensive, I shall point them towards this thread, and the OP's previous thread where he wanted a DB transfer and was frustrated about the time, cost and effort involved.

I remember the OP commenting at the time: All this I presume because there are some folk out there who if they lose money want to blame their IFA for bad advice and get reimbursed. I suspect there are lots of threads on this topic but my gut feeling says that the buck should stop with the individual - he/she can pay for advice but the final decision should be with the person receiving the advise and not the advisor. 

Also the OP realised this market event had happened in April, and commented Not that it matters because I shan't be making a complaint about it. Its those complaints that have left us in the situation we are today. 

And yet here we are, barely four months later when the OP is asking whether or not it is worth trying to gain compensation from the adviser due to the markets not behaving favourably.

Is it any surprise advisers just don't want to do this kind of work?

Previous thread here: https://forums.moneysavingexpert.com/discussion/6556908/pension-advisor-would-want-21-000-for-a-failed-transfer/p1

Dazed_and_C0nfused

michael1234 said:

Hello All

I recently transferred my DC pension that had some guarantees which meant I needed to take advice to do so (technically it was classed as a DB for transfer purposes but in reality it was a pension consisting of several normal funds that I could buy and sell at will). I paid for the advice and the transfer went ahead.

Unfortunately the sale took place in early April and given most of the funds had a high reliance on American stocks, I lost about 10% of its value within a week or so. The day the sale took place was Trump's Tarif Day and stocks sunk and then recovered in quick succession. The sale took place at the bottom of the sharp V. I was not able to buy back into the market until the transfer completed which was weeks later.

Obviously the advice had statements about market performance can go up and down but nothing about the specific risk of getting out of the market and then back in at a later date - selling up and then buying in again.

So, even though I'm still very sore about this, given the transfer FA completed the transfer successfully I would feel a bit guilty about lodging a speculative complaint. I would never dream of complaining about something going wrong as a result of losing Defined Benefits. But then I thought its free to try and it seemed to me 99% of the advice was about losing the DB benefits and not a lot else when there are clearly other risks. I barely realised that the stocks would be sold at all as for most of the lead up period I'd assumed it would be like an ISA where the stocks just move to a new provider.

Anyway, I suspect I haven't a leg to stand on but the finances are such even a 1% chance might be worth trying?

Thanks for reading and I would be very grateful for any replies from either people who are/have worked in the pensions or financial industry or people who have related experience to share and nobody else.

That isn't how forums like this work.

I suspect @HappyHarry's post is, rightly, going to get a lot of Thanks over the next day or two.

Aretnap

This is a wind up, surely? 

Also, John McEnroe applies.

(For younger readers:) https://www.youtube.com/watch?v=lFIQ-1SUZnw

cfw1994

There’s a wiki on this 👀
OP - in case it isn’t clear, you are right, it looks like you have no reason to complain 🤷‍♂️

Emmia

OP if you'd sold at the top of the market, and rebought at the bottom, would you be sending the advisor a lovely bottle of bubbly? Or offering to share your good fortune?

No? 

The "losses" you made are one of the risks of buying and selling shares - you've come off badly, but the decision to sell was yours alone.

The advisor presumably doesn't have a crystal ball or an insight into the workings of the orange ones mind (like the rest of us).

Juno_Moneta

Whilst a 10% drop due to timing is unfortunate - this is simply market risk and you will have been informed of this possibility in advance by default. 

Flipping it around, if the market moved the other way and you’d made a 10% gain simply by transferring - would you now be trying to compensate your advisor by sending them a cheque for the difference? I think not - and there’s your answer…

Aylesbury_Duck

"That said, the IFA did almost exactly what I wanted and it would feel morally wrong to apportion any blame."

You've answered your own question.

NickPoole

I'm not sure that whether it is morally wrong is the question here. The question is more about the chances of success.

If it costs nothing except your time then the risks are low (apart from the risk to your eternal soul..?)

Is there something obviously missing from the advice you were given? If you say you weren't specifically told if you sell at a low and buy back at a high you will lose money, it might get you some compensation.

It'll be scant reward for IFA who you persuaded to do exactly what you wanted, but hey - money's money!

artyboy

Might as well close this thread now, as I suspect MSE doesn't condone blatant greedy ambulance chasing activities like what the OP appears to be proposing.

@HappyHarry has summed it up perfectly, so enough said...