Rowanmoor SSAS Scheme Determination

The Pensions Ombudsman has issued a Determination in a complaint regarding the level of investment due diligence carried out in a Small Self-Administered Scheme (SSAS) set up with Rowanmoor Group Limited (Rowanmoor).

The complaint has not been upheld against Rowanmoor Executive Pensions Limited (a subsidiary of Rowanmoor), the SSAS administrator at the time of the events complained about, as it was not its responsibility to carry out the level of due diligence suggested by the complainant. However, the complaint has been upheld against Rowanmoor Trustees Limited (RTL) (another subsidiary of Rowanmoor), as it did not fulfil its duties as a trustee of the Scheme. Reflecting the shared responsibility with the member trustee, the Pensions Ombudsman has directed that RTL ensure that a sum equivalent to 80% of the Initial Loss Amount is returned to the scheme, as well as paying the complainant a sum of £1,000 to reflect the serious distress and inconvenience they have suffered as a result of RTL’s failure to discharge its duties as co-trustee in relation to the selection of investments.

Trustees (including professional trustees) have a responsibility for how scheme funds are invested, and need to ensure that they act in accordance with scheme rules as well as broader legislative requirements and common law duties of care. The Pensions Ombudsman has found that the investment in The Resort Group, who were developing a hotel in Dunas Beach, Cape Verde, was not appropriate and the lack of due diligence carried out by RTL caused a financial loss to the member.

The Pensions Ombudsman has seen a number of complaints from individuals who have transferred their pensions in order to invest in unregulated investments, such as fractional ownership schemes. In the most part, these have been made via transfers into SSAS’s where the member is the sole trustee and thus solely responsible for investment decisions. In this instance RTL was a joint trustee with the member, and for a period of time was the sole trustee of the scheme, charging the member for professional trustee services.

The Pensions Ombudsman is considering other complaints about due diligence in SSAS schemes provided by Rowanmoor and RTL and is looking at how these cases can be bought to resolution as quickly as possible. It should be noted that complaints could have different outcomes depending on how each scheme was set up and the investments they contained. Complaints are subject to our standard jurisdiction requirements as set out in legislation. Complaints must be brought to us within three years of the event complained about, or within three years of when the complainant reasonably became aware of the issue. Our regulations require a complaint to be raised with the party being complained about directly, and that party given the opportunity to respond before we are able to accept it for investigation.

Read the full Determination: The N 1953 Ltd Executive Pension Scheme (PO-25984)