We recently reported on the Pensions Ombudsman’s three determinations relating to suspected pensions liberation fraud (see our previous speedbrief here).

In each case, the complaints were brought by members who had made transfer requests to alternative schemes but those requests had been blocked.  Since those decisions were published, the Ombudsman has announced that it has received information suggesting that a number of other individuals may be considering bringing complaints that their transfers were made, but should have been blocked.  Much of the interest appears to be related to transfers to the Capita Oak Pension Scheme.

Key points in the Ombudsman’s announcement

The Ombudsman is currently investigating one complaint from a member whose transfer was executed but, in the member’s subsequent view, should have been blocked. The Ombudsman expects to publish its findings in relation to that complaint in the first half of this year. The Ombudsman has announced that, whilst it will only be binding on those parties to the complaint, it will give a good indication of its general approach to these complaints.

Potential complainants have been advised to refrain from making their own complaints about the same or similar issues. Any such complaints would not be progressed by the Ombudsman until a decision has been reached on the first complaint. Once the Ombudsman has published its decision, it is likely that any complaints made would be referred back to the transferring scheme to be investigated in light of that decision.

The Ombudsman has also advised affected parties that the time from now until the first case is published will not count in its calculation of whether a complaint has been made within its time limit (i.e. three years from when the transfer was made).

Further, any potential complainants have been reminded to ensure that they follow the transferring scheme’s complaint procedures before registering a complaint with the Ombudsman.

Implications

When the Ombudsman releases its decision in relation to this complaint, it will provide transferring schemes with an indication of how these requests should be handled in light of potential liberation fraud.  It seems almost inevitable that transferring schemes will also start to receive an increase in complaints from members that transfers that were made should have been blocked.  The Ombudsman’s three recent determinations have confirmed that the legal responsibility lies with trustees and managers to satisfy themselves that any requested transfer can lawfully be made, and this will no doubt lend weight to such complaints.   

As we reported late last year, the Ombudsman had advised that it was starting to look seriously at the issue of pensions liberation and associated frauds. We are hopeful that the publication of this determination will finally provide the transferring schemes with some guidance and direction on how best to approach these situations in future, though the problem of potential complaints in respect of past decisions on transfer requests is likely to continue for some time.