London Stock Exchange Group Pension Plan · CAS-30067-J3M7

CAS-30067-J3M7

Ombudsman’s Determination Applicant Mrs L

Scheme London Stock Exchange Group Pension Plan (the Plan)

Respondent Legal & General Assurance Society (L&G)

Outcome

Complaint summary

Background information, including submissions from the parties On 1 April 2017, Mrs L joined the Plan which is managed by L&G.

On 12 May 2017, Mrs L telephoned L&G to ask whether she could invest in the L&G MT Global Developed Equity Index Fund and was told that she could. On the same day Mrs L made an online switch request via L&G’s website.

On 16 May 2017, Mrs L telephoned L&G to say that she had “changed investments” but she could not see that the changes had been processed. L&G explained that this could take some time to go through but that the effective date would be 16 May 2017, and this would show online the following day.

On 17 May 2017, L&G wrote to Mrs L confirming that her instructions had been processed. The letter stated:

“We have changed the investment details for this account as requested from 16 May 2017. Detailed below are the subsequent investment details of the existing holdings.

L&G MT Global Developed Equity Index fund Units 158.774 CAS-30067-J3M7 Unit price (pence) 1,058.10 Fund value (pounds) 1,679.99”

On 22 May 2017, Mrs L contacted L&G because it did not appear that her instructions had been processed when she checked online. Mrs L said:

“...I have elected to invest 100% of my pension in the L&G MT Global Developed Equity Index fund on the L&G website instead of the default fund Multi-Asset (PMC)3 on 12 May 2017. I spoke to someone on the telephone who mentioned it was okay. The change did not seem to have been made when I checked on the system today, and it does not look like I can select anything anymore. Could you please let me know if the change has been recorded and when it will take effect?”

L&G responded and apologised for the delays Mrs L had experienced and said:

“…the switch has taken place and you are now invested in the new fund…”

On 18 March 2019, Mrs L emailed L&G to raise her concerns that:

• In May 2017 she made a request that L&G should invest all her investments into the L&G MT Global Developed Equity Index fund instead of the default fund.

• She had difficulties in requesting the amendment online because the system reverted her new fund choice to the default fund. Despite several attempts the error still persisted.

• She would like her investments adjusted to reflect all her investments having been allocated to L&G MT Global Developed Equity Index fund since May 2017, following the request she had made at that time.

• She would like these issues dealt with as a formal complaint and for an award to be made in recognition of the distress and inconvenience she had experienced.

On 20 March 2019, L&G replied that:-

• Its records showed that she made a switch request on 12 May 2017, and this is what has been confirmed to her.

• Mrs L had only switched her existing investments at that time and did not place an instruction to redirect any future investments into the L&G MT Global Developed Equity Index fund.

• L&G sent Mrs L a confirmation letter after the investment change, confirming that her existing investments had been switched.

• L&G provided Mrs L with copies of three benefit statements sent to her since the switch was processed, detailing the investment split as follows:

2 CAS-30067-J3M7 o Benefit statement dated 9 May 2018 covering the period 9 May 2017 to 8 May 2018

Where your pension pot was invested on 8 May 2018

94.94% Multi-Asset (PMC)3 5.06% L&G MT Global Developed Equity Index

o Benefit statement dated 15 June 2018 covering the period 6 April 2017 to 5 April 2018

Where your pension pot was invested on 5 April 2018

95.09% Multi-Asset (PMC)3 4.91% L&G MT Global Developed Equity Index

o Benefit statement dated 7 August 2018 covering the period 7 August 2017 to 6 August 2018

Where your pension pot was invested on 6 August 2018

95.37% Multi-Asset (PMC)3 4.63% L&G MT Global Developed Equity Index

• Although not as she may have intended, the switch Mrs L requested online was processed correctly. As a redirect of future investments was not requested, L&G was unable to backdate that instruction.

• Any future switch and redirection requests could be processed on request.

On 20 March 2019, Mrs L emailed L&G to request that all further investments be redirected to L&G MT Global Developed Equity Index Fund as requested in May 2017.

L&G responded by saying:-

• Mrs L’s email of 20 March 2019 was not simply a switch request; in order to move all current and future contributions, L&G would need to process a “switch and redirect”.

• The same issue applied to Mrs L’s online request in May 2017, because no redirect request was included.

• L&G was unable to amend historical messages from its online messaging service, this included time stamps or dates.

3 CAS-30067-J3M7 Mrs L’s position

Mrs L said:-

• The way information is displayed on L&G’s website makes it impossible for a member to know the performance, type of fund and total fees associated with each fund. So, it is “impossible” for a member to make their own fund selection and their investments remain in the default fund.

• The default fund may be more profitable to L&G.

• She chose to invest in the L&G MT Global Developed Equity Index fund, because she was aiming to benefit from a “passive management/indexed, low cost fund” that she thought offered the best value.

• She had three recorded telephone calls with L&G in May 2017 and received one written message from L&G confirming that her investments would be allocated to the L&G MT Global Developed Equity Index fund.

• When L&G subsequently invested her payments in the default fund in error, she raised her concerns.

• She did not receive benefit statements and contacting L&G by telephone was very difficult. She was also not aware that it was possible to request benefit statements online.

• She has not changed address since joining the Plan and there are no issues regarding receiving mail.

• She would like her payments adjusted to reflect investment in the L&G MT Global Developed Equity Index fund from May 2017 and for L&G to make an award in recognition of the distress and inconvenience she has experienced.

L&G’s position

L&G said:-

• As Mrs L chose to change her investments online, it was her responsibility to make sure that she had done so as intended. If Mrs L had called to complete the switch L&G would have specifically asked whether she wanted to redirect future contributions at the same time.

• Screenshots of L&G’s website in 2017 show that members would have needed to select a switch or redirection of future contributions at the time. If a member wanted to do both then they needed to complete entries in fields for both options, then click to confirm. Mrs L only completed the switch field then clicked to confirm, but she would have seen from her online account that she needed to complete a switch and redirection of future contributions separately.

4 CAS-30067-J3M7 • There are records of only two telephone calls received from Mrs L, on 12 May 2017 and 16 May 2017, both regarding investment in L&G MT Global Developed Equity Index Fund. A redirection of future contributions was not discussed in either conversation.

Adjudicator’s Opinion

• Screenshots of L&G’s website from 2017 show that it would have required Mrs L to input a switch and redirection of future contributions separately in order make that instruction. Consequently, L&G has not been unreasonable in determining that Mrs L did not request a redirection of future contributions in May 2017.

• Mrs L said that she did not subsequently receive benefit statements, and that it was difficult to contact L&G by telephone. L&G has confirmed that the benefit statements were correctly addressed, and it cannot be held responsible if the statements failed to be delivered to Mrs L. But in any event, it would have been reasonable for Mrs L to have checked online as to how her contributions were being allocated or requested updates by sending messages via L&G’s website.

5 CAS-30067-J3M7

Mrs L did not accept the Adjudicator’s Opinion and the complaint was passed to me to consider. Mrs L maintained her previous position which does not change the outcome. I agree with the Adjudicator’s Opinion.

Ombudsman’s decision

I do not uphold Mrs L’s complaint.

Anthony Arter

Pensions Ombudsman 13 November 2020

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