Donna-Marie Hughes had sought to transfer her £8,360 pension, but Royal London became concerned that pension liberation fraud was occurring.
Miss Hughes indicated in her transfer request that she had originally been contacted by First Review Pension Services, and Royal London stated that it believes the company to be operating through “cold calling” potential customers.
The Principal Employer was only registered shortly before the transfer request; the SSAS was registered by HMRC only 3 days later; and Miss Hughes’ employment agreement is non-specific on role requirements and remuneration.
The registered address is Miss Hughes’ home address in Devon but the nature of business was not supplied, and no accounts have yet been filed. Miss Hughes is the only individual employed by the company and she does not currently receive a salary from the company.
In his decision, Anthony Arter, Pensions Ombudsman, said:
"The fact that there was no statutory right and a concern about unauthorised payments, at least until Miss Hughes made a contribution to the SSAS, are relevant factors Royal London would be entitled to take into account in exercising that discretion. It is clear from their recent review that Royal London considered there was no statutory right and then went on to assess whether they should nevertheless exercise a discretion to transfer. Having done so, they then exercised their discretion in a way they were entitled to under the rules of the scheme.
"Royal London, though, did not ever explain their decision to Miss Hughes in those terms – as they have accepted during their recent review. If they had done so, it might have made Miss Hughes reconsider her transfer request or at least take further independent advice on her position. Having completed their due diligence and concluded that there was no right to transfer they should have been able to justify that to Miss Hughes.
"I find that Royal London’s decision not to pay the transfer value was consistent with the law. I do not uphold Miss Hughes’ complaint."
