Bruce Bennett trading as Beneficial Financial Management · DRN-6171477

The complaint Mr I complains that he does not recall signing an ongoing advice fee agreement with Bruce Bennett trading as Beneficial Financial Management (‘BB’) giving it his authority to take ongoing fees from his pension. But he says in any event, he hasn’t received any annual reviews or personalised financial advice from BB during the time it was his assigned financial adviser. What happened The details of this complaint are well known to both parties, and the investigator set things out in detail in their assessment, so I won’t repeat everything again here. The following is a summary of the background leading up to the complaint to provide some context. Mr I held an existing pension with a provider I shall call ‘Firm A’ which he’d held for several years. Prior to BB’s involvement in matters, Mr I’s pension was supported by another regulated firm, which was providing him with ongoing services including annual review meetings. I understand that around March 2016, the adviser who was providing the ongoing service to Mr I left the regulated business in question and introduced him to BB. BB has told us that it entered into an agreement with this individual, who was by this time now unregulated, to act in an introducer capacity. Their unregulated status did not change throughout the relevant period. BB says this individual was contracted to assist in the servicing of clients’ accounts under the supervision of a regulated adviser. Following the introduction to BB, Mr I wrote to Firm A on 23 March 2016, asking it to transfer the servicing rights and ongoing adviser fees to BB. Mr I says he doesn’t recall signing a fee agreement with BB. And while it has not been able to provide a signed copy, I understand, and it seems likely based on the example evidence provided in other similar complaints, that on or around the same time, Mr I would have been asked to sign a “Service and Payment Agreement – Advised Services.” This type of agreement was a necessary requirement to set out what services it would provide to Mr I in exchange for ongoing fees. Investment statements provided by Firm A show that ongoing advice fees were being deducted from Mr I’s pension investments to pay for this ongoing service. The example agreement BB has provided us in other similar complaints said it would: “contact you at least every 12 months to offer you a meeting to review your current circumstances, needs and objectives. During this review we will also provide you with a summary (either verbally or in writing) of the performance status of the policies and investments on which we provided you with initial advice. If you specifically ask us to do so, we may review the ongoing suitability of other policies or investments which were not part of our initial advice and an additional payment may be agreed for this. If we recommend any changes we will implement them with your agreement.” Also, I’m aware that BB sent its clients an acknowledgement letter following the introduction

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from the previous adviser, now introducer. This explained that BB was aware its clients “have been used to an excellent level of service from [X] and we will do our utmost to maintain these standards.” It went on to say, “Although [X] is not authorised at this time to provide Independent Financial Advice, we are delighted to confirm that he will be working with us to maintain continuity and ensure we meet your expectations.” In October 2024, Firm A wrote to Mr I to confirm it had received confirmation that BB was no longer acting on his behalf. In July 2025, Mr I complained to BB raising the points I set out at the start. BB responded in a final response letter of 22 October 2025, in which it said it didn’t uphold the complaint. In summary it said the introducer was paid 50% of the fees it received to provide a similar service to the one Mr I was familiar with previously. But it said that because it had been removed as Mr I’s servicing agent (and he’d declined to give it his authority to obtain details from the provider) coupled with the introducer’s failure to co-operate with it and provide relevant documentation, it couldn’t confirm the servicing activity provided. But it said the account was subject to a rebalancing regime that involved Mr I receiving quarterly reports and an offer of a face-to-face meeting. It also said it felt Mr I’s complaint was time barred – the events in question were more than six years ago and more than three years after he realised there was a problem. Because Mr I remained dissatisfied, he asked us to consider his complaint. One of our investigators then looked at everything and they concluded that they could only consider the events (each missed review) in the six years immediately prior to Mr I referring his complaint to BB. The complaint about the missed reviews prior to 3 July 2019 was out of time because Mr I ought reasonably to have been aware he had cause for complaint more than three years before he complained. This is because he told us that when he moved to BB, he expected to receive a similar service to the one he was paying for previously. Regarding the merits of the complaint, the investigator said BB hadn’t provided evidence to show Mr I got the service agreed to and which he was paying for between June 2020 and when the service was switched off in 2024. So, they said Mr I should receive a refund of the fees he paid from 3 July 2019, to when they ceased in 2024 adjusted for growth. Mr I accepted the investigator’s findings. BB said it disagreed and asked for an ombudsman’s decision, albeit it didn’t offer any reasoning as to why it disagreed. What I’ve decided – and why I’ve considered all the available evidence and arguments to decide what’s fair and reasonable in the circumstances of this complaint. I’ve taken into account relevant law and regulations, regulatory rules, guidance and standards, codes of practice – much of which can be found in the Financial Conduct Authority (FCA) handbook under the Conduct of Business Sourcebook (COBS) and Principles for Businesses (PRIN) as they were at the time of the advice – and (where appropriate) what I consider to have been good industry practice at the relevant time. And where the evidence is incomplete or inconclusive I’ve reached my decision based on the balance of probabilities – in other words, on what I think is more likely than not to have happened, given the available evidence and wider circumstances. The following provides useful context for my assessment of the ongoing services that BB ought to have been provided here.

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COBS 6.1A.22: A firm must not use an adviser charge which is structured to be payable by the retail client over a period of time unless (1) or (2) applies: (1) the adviser charge is in respect of an ongoing service for the provision of personal recommendations or related services and: (a) the firm has disclosed that service along with the adviser charge; and (b) the retail client is provided with a right to cancel the ongoing service, which must be reasonable in all the circumstances, without penalty and without requiring the retail client to give any reason; or (2) the adviser charge relates to a retail investment product for which an instruction from the retail client for regular payments is in place and the firm has disclosed that no ongoing personal recommendations or service will be provided. In 2014, the FCA produced guidance in the form of a factsheet (For investment advisers - Setting out what we require from advisers on how they charge their clients). The factsheet said: ‘Ongoing adviser charges Ongoing charges should only be levied where a consumer is paying for ongoing service, such as a performance review of their investments, or where the product is a regular payment one. If you are providing an ongoing service, you should clearly confirm the details of the ongoing service, any associated charges and how the client can cancel it. This can be written or orally disclosed. You must ensure you have robust systems and controls in place to make sure your clients receive the ongoing service you have committed to.’ While the factsheet wasn’t published until late 2014, it didn’t mark a change to the rules firms like BB were already expected to follow. In my view, it re-enforced or reminded firms of the standards already in place when providing on-going advice services. Having considered all of this and the evidence in this case, I’ve decided to uphold the complaint for broadly the same reasons as the investigator. My reasons are as follows. Firstly, and for the avoidance of doubt, because Mr I accepted the investigator’s findings, which included their conclusion on our jurisdiction to consider the complaint, I don’t consider it is necessary for me to decide our jurisdiction this here. This is because the only events which I’m considering here are those which fall within six years of Mr I referring his complaint. Which by default fall within our power to consider regardless. As I said above, BB hasn’t been able to provide a copy of the paperwork Mr I signed setting out the agreed services it would provide in exchange for its 1% ongoing annual fee. But it’s not disputed that Mr I transferred the servicing rights to BB and that he was paying it for an ongoing service – the necessary amounts deducted from his pension with Firm A. It also doesn’t appear to be in dispute what level of service ought to have been provided based on the example agreement BB has previously provided us with, and based on the level of service BB indicated to Mr I he should expect to receive going forward – that is, it being broadly similar to what he received from the previous regulated business prior to transferring to BB. Primarily, Mr I was paying for and expected to receive contact from BB at least once a year to offer him a meeting to review his current circumstances, needs and objectives – i.e. an ongoing suitability review.

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So, on the basis that Mr I transferred servicing rights to BB in March 2016, and he likely signed the agreement around the same time, annual reviews ought reasonably to have taken place on or around the anniversary of the agreement being signed (for the period I’m considering here, from March 2020 onwards.) Mr I says he hasn’t received any personalised ongoing advice or had any review meetings. And while BB has said what its servicing proposition ought to have looked like, it hasn’t been able to provide any evidence to show that either reviews were conducted with Mr I, or that it made reasonable attempts to invite him for a review, and/or that he declined the invitations. BB has explained that it entered into an agreement with the introducer to assist it with the administration and ongoing servicing of its clients, in exchange for a percentage of the ongoing advice fees it received. It says the information about annual reviews was held or stored by this individual. It says the lack of information available in this case is because it hasn’t been able to get the information from the individual concerned – they’re unwilling to cooperate because of the ongoing dispute between the parties. It also says it has been unable to get information from Firm A because it’s no longer the servicing agent. Firstly, it’s unclear to me why Firm A would hold any information about the ongoing reviews carried out – it’s the product provider not the adviser. It was BB’s responsibility to provide this service and keep records of it. And secondly it seems odd that records of the servicing of clients and annual reviews carried out were held by the unregulated introducer, notwithstanding that BB says it appointed one of its regulated advisers to oversee these activities. Any commercial decision BB took and any agreement it entered into to effectively outsource services to an unregulated third party, does not, in my view, alter the fact that BB, as the regulated firm, was responsible for providing the contracted services to Mr I, for which it was receiving an ongoing fee. The introducer was not a party to the agreement here – it was BB that was obliged to provide ongoing services to Mr I. BB needed to ensure it had robust systems and controls in place to make sure its clients, including Mr I, received the ongoing service it committed to. So, I would expect it to have been able to clearly evidence the service it provided to Mr I. But ultimately, and regardless of the reasons why, in this particular case BB has not been able to give us evidence that it offered or provided the ongoing service Mr I paid for. So, on the basis that Mr I says he didn’t receive an ongoing service and BB can’t demonstrate otherwise, I think it’s likely Mr I did not get what he paid for. In these circumstances, I think it is fair that Mr I gets a refund of the fees he paid for the period I’m considering here – that is, from 3 July 2019, on the basis the fees pay for the review in advance, to the point servicing rights ceased. Putting things right – fair compensation I think fair compensation in this case means BB should refund Mr I the ongoing advice fees he paid from 3 July 2019 to the point they were cancelled. BB should also add a return on the fee amounts from the date the fees were paid to the date of my final decision. Because the fees were taken from the investment, I think the amounts would otherwise have remained invested, so Mr I’s pension value would have been higher by the value of those fees and any investment returns that those fees would have gone on to benefit from. So, to put things right BB should do the following:

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• Refund the ongoing advice fees Mr I paid from 3 July 2019 to when they ceased in 2024, plus a return on the fee amounts from the date the fees were paid to the date of my final decision. • The lost return on the fees should be calculated by using the actual return generated by the investments they were taken from. • If it is not possible to calculate the actual return generated, then the return should be based on the FTSE UK Private Investors Income Total Returns Index (prior to 1 March 2017, this was called the FTSE WMA Stock Market Income Total Return Index). This index is a set of calculations that demonstrates performance of various asset classes. Its diverse, transparent, industry used and adjusted quarterly. I think this is a fair and pragmatic alternative in the circumstances and represents the sort of return Mr I would have got by wanting capital growth and accepting some risk to his money. • The compensation amount should be paid into Mr I pension plan if possible. The payment should allow for the effect of charges and any available tax relief. The compensation shouldn’t be paid into the pension plan if it would conflict with any existing protection or allowance. • If a payment into the pension isn’t possible or has protection or allowance implications, it should be paid directly to Mr I as a lump sum after making a notional reduction to allow for future income tax that would otherwise have been paid. • If Mr I has remaining tax-free cash entitlement, 25% of the loss would be tax-free and 75% would have been taxed according to their likely income tax rate in retirement – presumed to be 20%. So, making a notional reduction of 15% overall from the loss adequately reflects this. • Provide Mr I with a copy of the above calculation in a clear and easy to understand format. If payment of compensation is not made within 28 days of BB receiving Mr I’s acceptance of my final decision, interest must be added to the compensation at the rate of 8% per year simple from the date of my final decision to the date of payment. Income tax may be payable on any interest paid. If BB deducts income tax from the interest, it should tell Mr I how much has been taken off. BB should give Mr I a tax deduction certificate in respect of interest if he asks for one, so he can reclaim the tax on interest from HMRC if appropriate. My final decision For the reasons above. I’ve decided to uphold this complaint and I instruct Bruce Bennett trading as Beneficial Financial Management to put things right in line with the approach above. Under the rules of the Financial Ombudsman Service, I’m required to ask Mr I to accept or reject my decision before 27 April 2026. Paul Featherstone Ombudsman

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