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Ombudsman’s general approach to misstatement cases 2

United Kingdom
03/10/2006
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Reference: P00850

This determination concerned a final salary scheme with a money purchase underpin, which went into wind-up with insufficient assets to meet the member’s benefits. The member argued, in the light of statements in the booklet referring to the money purchase underpin as a ‘Personal Pension Account’, that the monies constituting the underpin should have been separately ring-fenced and protected, rather than being notional accounts. The member claimed that the booklet statements amounted to “gross, systematic, consistent, and serial maladministration, professional negligence, malpractice, and fraud”.



In rejecting the complaint, the Ombudsman provided a useful paragraph on his office’s position on the misstatement of pension scheme benefits:



“Generally speaking, if booklets, announcements or statements are inconsistent with the Plan Rules this will not result in any change to a Member's entitlement. That entitlement will depend on the Rules subject to any overriding statutory provisions. If incorrect information has been given in other documents this will not give rise to any additional benefit under the Plan although may be grounds for providing compensation or some other direction from me if the incorrect information has reasonably been relied upon to a member's detriment.”

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