Dear Mr. Grace:
I am writing to you about our ongoing concerns for people transferring out of Aegon policies. These now impact c.600 customers. I am requesting the immediate resumption of electronic pension transfers between our firms.
I have opted for an “open letter”, as Aegon will not meaningfully engage with us despite direct letters to you, your Independent Governance Committee and various other Aegon employees. I point out that our Chairman, Mr. Mark Wood, has repeatedly offered to meet you in Edinburgh to discuss this matter but has been rebuffed – indeed on one occasion, a planned meeting was cancelled without notice.
Aegon’s arduous transfer approach for our mutual customers is out of line with that of its peers, who enable customers to switch their pensions quickly and safely to their chosen provider. Our experience in completing over 10,000 transfers is that best-in-class providers, including Aviva, Legal and General, Prudential, Scottish Widows and Standard Life, typically transfer electronically in 12 days or less.
In contrast, since 8 June 2017, customers wishing to transfer out of Aegon to PensionBee have faced barriers to switching, including multiple discharge forms, telephone calls and repetitive requests for information that has already been provided. There are various other steps that impede the customer’s right to switch pension provider easily (please see here). The average transfer out of Aegon for completed transfers now takes c.54 days - although the true scale of detriment remains unknown, since many people have been unable to overcome the barriers placed in front of them by Aegon in their attempts to switch or have simply given up.
This is all extremely puzzling as prior to 8 June 2017, Aegon readily used electronic means to transfer the policies of over 300 customers to the PensionBee Personal Pension.
I note that your communication to our mutual customers refers to due diligence and the importance of preventing transfers to pension scams. I wholeheartedly agree that this is an important aspect of any transfer decision, but Aegon has not clarified to us any specific due diligence concerns that it has regarding PensionBee. More importantly, I am concerned that bombarding customers with impersonalised pension scam warnings will lead to such letters being considered as red tape. The consequence may be that some people ignore genuine red flags when transferring to an actual pension scam.
Although I have already sent you this information several times, I will include it here again for completeness:
- PensionBee, established in 2014, is authorised and regulated by the Financial Conduct Authority as a pension provider and we have our own wrapper
- The PensionBee Personal Pension is an HMRC-registered personal pension and no unauthorised transfers or withdrawals are permitted from the scheme
- All underlying investments are provided by BlackRock (Aegon’s primary asset manager), Legal and General Investment Management and State Street Global Advisors, who is our largest external shareholder
As you will know given my letter to the Financial Conduct Authority, I do not believe Aegon’s approach to transfers-out is Treating Customers Fairly. It doesn’t help the millions of people who have been auto-enrolled consolidate several small pension pots. As I’m sure you know, TCF’s Outcome 6 requires that “Consumers do not face unreasonable post-sale barriers imposed by firms to change product, switch provider, submit a claim or make a complaint.”
As a result of unfair treatment, some customers who have completed transfers have begun or are considering taking Aegon to the Ombudsman for compensation. Our records indicate at least 56 customers have already complained to you (although our understanding is that many more have come to you directly) and that you have compensated some of them due to admitted errors in your processes.
I thought it would be helpful for you to hear some of the complaints in the customers’ own words, as I appreciate resolving this situation may not be on the top of your very long to-do list.
“Whilst I appreciate your role in minimising pension fraud and advising me to make considered decisions, I now find your actions to be deliberately resistant and are designed to fatigue me in moving - something I will be highlighting to the Financial Conduct Authority and FOS.
I have moved 2 other pensions from Scottish Widows and Legal & General to Pension Bee and this process was completed within 30 days. This current process is taking more than 3 months.
You write and continue to advise me to avoid pension scams. I have researched the company I am moving it to and will again confirm the below
- They are regulated by the Financial Conduct Authority – whilst capital is at risk- it provides the same level protection as you do.
- The two funds are with State Street and Blackrock – with billions under management
- I understand the fees may be more- and am happy to pay the small (0.1%) increase due to the better online dashboard
- They have a strong trust pilot score from existing users
Had I requested to move my funds to a small start-up in China or an investment vehicle that provided inflated returns, you would be right to challenge. Pension Bee have not provided any short term unrealistic claims and have been able to show what funds might be available at 66 years old.
Furthermore, their website has helped me identify shortfalls in my current saving plan for the yearly amount I wish to live on in retirement.
Your actions on the other hand are now boarding on bullying/scare-mongering and domineering in threatening not to release my funds.
I have completed numerous questionnaires, provided proof of identify and I am asking one final time for this transfer to be completed.”
“You will be amused to note that Aegon seem to think that PensionBee is a fraudulent scheme, despite having already transferred two of my schemes to it already.”
“I’ve received your letter dated 12 July enclosing a 4-page “due diligence” form, which you appear to be requiring me to complete (together with providing supporting documents) as a condition of complying with my instruction to transfer the pension fund to another FCA approved pension scheme. I’m an experienced lawyer who used to advise on pensions law and I fail to see what purpose is served by this form. I’d be grateful if you could refer me to relevant clause(s) in the Trust Deed or Scheme Rules which entitles you to refuse to execute my instructions unless I complete such a form.”
“What more due diligence checks are required?? I have completed all these forms already and advised your adviser I am happy for the transfer to proceed?
In terms of seeking financial advice this is not required below £25,000 and since my funds are just over £400 I will NOT be doing this.”
“What do I have to do to get my money??? This is ridiculous!!”
“I have responded to Aegon recently as they sent me many complicated forms which I did not understand. I wrote them back advising they need to allow PensionBee access to my funds. Please contact Aegon to confirm and advise when this has been done please as I would not like to have to complete the confusing forms they sent me.”
“Aegon are being real pains in the neck about my other pension transfer. I had to fill in a long form, have had two calls (asking the same questions), emails telling me if I don’t reply they’ll cancel the transfer (I replied) and now they are asking my to fill in a Discharge Indemnity Form with clauses like the ones pasted below.
They say if I don’t fill it in, they will cancel the transfer. It seems to be one thing (excuse) after the other. In your experience, is the latter normal? And, legally, do I have to fill in the indemnity form?”
“Yes, please proceed with this transfer! I have instructed you to do so on several occasions. I have completed an exhaustive questionnaire and also taken a call and been through all the responses again!
I cannot make myself clearer, I want you to proceed with this transfer as soon as possible. I believe now Aegon is being obstructive in delaying to do so. You can see that my receiving scheme (PensionBee) is bona fide and there is no reason now not to proceed.
I have carried out all my background checks, and am fully informed of all the facts. I have worked extensively in the financial services, investment and retirement planning sectors. Please remember also that this is my money, not yours, and I will decide what to do with it.”
“I have just been on the phone for what must be the 9th time now regarding my transfer of both pensions away from Aegon. I was actually speaking to a rather helpful colleague of yours [redacted] who send over yet more forms can you believe.
However over the last 4 months, I have been treated appallingly and you have left me no choice but to complain through the proper process for my unnecessary time spent trying to transfer both my pensions to my Pension Bee portfolio.
The word “Disgusted “ doesn’t even come close to the way I feel about Aegon, having had the displeasure of dealing with your company. Back in September 2017, Aegon received an instruction from Pension Bee along with 2 other pensions of mine (Aviva and Scottish Widows) both of which were transferred within 6 weeks without any hitches all online. Not even a single phone call was required on my behalf.
Aegon, on the other hand… Well, where do I begin?
I have filled out identical sets of forms twice , even 3 times in one instance, emailed several times, rang the customer service centre. Altogether I have spent an estimated 10 - 12 hours of my life trying to transfer my pensions.
I charge £30 per hour for my time so you leave me no option but to send you an invoice for my loss of earnings due to gross incompetence.
I am not sure why you choose not to employ electronic means for your pension transfer protocol. It beggars belief that in 2018, you will not embrace change and act like Luddites. All that is achieved is the alienation of your customer. I for one can honestly say that I nor my friends and family would ever recommend Aegon.
As a goodwill gesture, I expect Aegon to recompense me for my loss of earnings, through full payment of the attached invoice. I believe this is the very least you can do. If you choose not to offer me an equivalent form of recompense then I will have to follow legal proceedings for my loss of earnings.
If you cannot solve my complaint within the next 4 days, Please provide me with the contact details for the Financial Ombudsman to escalate the complaint.”
End of sample customer feedback
It is difficult to understand why Aegon treats its customers differently to other providers, who are all transferring electronically to the same FCA-regulated PensionBee pension plan. I look forward to your response or better still, the resumption of electronic transfers between our companies.
Chief Executive Officer