ILLUSTRATION BY RUSSEL HERNEMAN
Last summer I sought to use retirement savings of £139,000 to buy a Legal & General annuity through the financial firm Charles Stanley. My pension savings are held by Embark Pensions and it has turned into a prolonged and frustrating administrative battle to try to get access to this money.
Despite providing the necessary identification and signed authorisations in June, the transfer has still not happened. I made a formal complaint in September but the reply seems to say that Embark can only investigate after the transaction has completed. This misses the point because the problem is that the transaction is not completing.
I hope you can look into this for me. It is disappointing that when we are being encouraged left, right and centre to save for retirement in a pension, the pension firms make it so difficult to access your money.
Antony, Reading
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Holly Thomas writes
You retired some 15 years ago, after a long career in financial services, and left some of your pension savings untouched. Now at 78, and with changes afoot that will see pension pots added to the value of an estate for inheritance tax purposes, you decided to change tack.
You plan to use the pension, built up from your early days as a stockbroker, to buy an annuity — a type of insurance policy that will provide a guaranteed, regular income. It’s an attractive time to take out an annuity, because interest rates have risen, giving you a better income in return for your lump sum.
When you come to access a pension, you are usually entitled to take a 25 per cent tax-free lump sum. You took £21,000 of yours from this pension in 2013 when you moved it into a Charles Stanley self-invested personal pension (Sipp). Embark, which took over the Charles Stanley Sipp business in 2017, paid you the remainder of the tax-free amount (about £11,500) in November, but you were still waiting for the rest of your pot when you wrote to me in December, and were feeling very uneasy about the whereabouts of your hard-earned savings.
After my involvement Embark, now part of Lloyds Banking Group, got its skates on and actioned the cash to be transferred to complete on the annuity. L&G sent you a backdated December payment of £844.04 and you have been paid monthly since January. You also accepted £878.89 from Embark as compensation for distress and inconvenience, as well as some lost interest.
The last stage was for Embark to complete an assessment to see if you had suffered any financial loss from the delay in accessing your pension savings. Unfortunately, this took until April to complete while different calculations were requested and analysed. After much chasing, Embark finally concluded that there was no financial loss after all, but it made a goodwill payment of £1,688 in recognition of the delay to the start of your income.
You said: “My money disappeared into a black hole for several months which was a worry, so I’m very relieved it’s all sorted. It really shouldn’t take such a huge effort to access money that we are told to save for a secure financial future. I’m fortunate that I wasn’t relying on this money for anything but that’s not the case for all. Thank you.”
Embark said: “We are sorry for not transferring funds sooner and for the service the customer experienced. We’ve made sure he wasn’t out of pocket as a result of this and made a payment for the hassle caused.”
An annuity is a very stable way of funding retirement but can take time to set up if you are buying one from a different company to the one that holds your pension. If your firm is not moving fast enough you can raise a formal complaint. If your problem has not been resolved within eight weeks, you can approach the Pensions Ombudsman.
I was a fraud victim. Why is Tesco Mobile so impossible to call?
I am a 62-year-old single woman. I work full-time and am a diligent saver and very careful with money. About a year ago, some scam artists conducted an elaborate scheme to steal my credentials to use my bank account to pay for a Tesco Mobile account.
I have always been with Vodafone and have tried for many months now to get Tesco Mobile to understand that I never signed up for its service.
I was being billed about £28 a month for this account and eventually, in frustration I blocked it and cut off the payments. My bank refunded me those that had been debited, but months later I discovered that my stellar credit rating had sunk to dreadful levels because I am in “debt” to the tune of £500 for unpaid mobile bills.
I have sent Tesco Mobile texts, tried to call, emailed and have left online reviews about the problem. One time I managed to get someone to take my details, but they never followed up.
I will soon be retiring, so I can’t afford to have my financial status ruined by this issue. It is causing me enormous stress, which is seriously affecting my already poor health. Can you help? I don’t know what to do any more.
Jo, Chepstow
Holly Thomas writes
This issue dates back to this time last year when you had a call from someone claiming to be from Vodafone offering you a new better deal. Since you have a Vodafone account you assumed it was renewal time. Once you had made a small upfront payment the upgrade was confirmed by a text message and, soon after, a new phone that you had not signed up for arrived at your home.
You texted the person who had called you, to tell them to take the phone back and they sent a courier to collect it. A couple of weeks later you had a welcome package from Tesco Mobile and then monthly bills for a Tesco Mobile account.
Unfortunately, this is a common scam designed to use someone’s personal and financial details to obtain a new phone that can be sold on, leaving the victim with the contract. Some scammers have been known to turn up at a victim’s house claiming to be couriers and asking for the phone back, explaining that it was delivered by mistake.
You stopped the payments with the help of your bank but didn’t realise that the debt was still accruing in your name until you checked your credit reports before co-signing a rental agreement for your elderly father. He lives in Canada, where you lived for a time, and luckily you had a Canadian credit report that was in top condition so the co-signing could still go ahead.
While your efforts to get this matter investigated were inexcusably ignored, Tesco sprung into action after hearing from me. It has agreed to wipe the £525 debt, but couldn’t explain why it had never acted on your requests to address this.
You said: “This has been an absolute nightmare which you resolved incredibly quickly. I’m in awe. You have no idea how much I appreciate this and how much stress you just lifted.”
Tesco Mobile said: “Protecting people from fraud is our top priority and we are sorry to hear about the issues faced here. As soon as this was brought to our attention, we contacted the customer directly, closed the account with immediate effect, and took steps to ensure there is no impact on her credit file.”
If you are caught out by an unsolicited call and a fraudulent credit agreement is opened in your name, you should contact your bank and the relevant provider and report the scam to Report Fraud on 0300 123 2040. You can also speak to the credit reference agency and request that the debt be marked as disputed while you try to settle things. Checking your credit report regularly can also help to nip any problems in the bud.
£1,001,408 — the amount Your Money Matters has won back for readers so far this year
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