Fidelity Self Invested Personal Pension Scheme · CAS-56878-Q0F5

CAS-56878-Q0F5

Ombudsman’s Determination Applicant Mrs I

Scheme Fidelity Self Invested Personal Pension Scheme (the SIPP)

Respondent Fidelity International (Fidelity)

Outcome

Complaint summary

Background information, including submissions from the parties The sequence of events is not in dispute, so I have only set out the salient points. I acknowledge there were other exchanges of information between all the parties.

On 11 March 2020, Mrs I instructed Fidelity to sell the units she had invested in the Baillie Gifford Emerging Markets Growth fund (the Baillie Gifford Fund). The instructions were received at 12.50 am; Fidelity completed the sale on the same day.

The Key Investor document for the Baillie Gifford Fund (the Key Investor Document) states:

“You can sell some or all of your shares on any business day in the United Kingdom by contacting our Dealing Department by phone or post. Where properly completed documentation is received by post, shares will be sold at the next valuation point following receipt of the instruction.”

The value of the units in the Baillie Gifford Fund amounted to £21,973.28, as at the valuation date of 12 March 2020.

On 14 March 2020, Fidelity sent Mrs I confirmation of the value of the units that had been encashed (the Sale Confirmation Letter). Fidelity said that 3,117.22 units

1 CAS-56878-Q0F5 were sold at a unit price of £7.0490. However, Fidelity incorrectly said that the valuation date was 13 March 2020.

Mrs I telephoned Fidelity to query the valuation date of 13 March 2020. Mrs I explained that she was expecting Fidelity to use a valuation date of 11 March 2020. The Fidelity representative apologised and said that they would look into the matter and take corrective action.

On 24 March 2020, Mrs I telephoned Fidelity. Mrs I reiterated that she was expecting the valuation date to be 11 March 2020, the date she submitted the instruction to sell the units in the Baillie Gifford Fund. During the telephone call, the representative clarified that the valuation date on the Sale Confirmation Letter was incorrect; the correct date was 12 March 2020. The representative explained that the Baillie Gifford Fund operated a trading plus one day policy. Consequently, units were valued on the next working day following receipt of an instruction to trade.

Mrs I subsequently submitted a formal complaint to Fidelity.

In late March 2020, Fidelity provided its response to Mrs I’s complaint and explained that:-

• Fidelity and the Baillie Gifford Fund Manager had agreed a daily cut off of 4pm for the sale of any units in Baillie Gifford funds. Units would then be valued on the next working day, provided the instruction had been received before 4pm.

• To receive a valuation date of 11 March 2020, Mrs I would have been required to submit a sale instruction before 4pm on 10 March 2020.

• The units from the sale of the Baillie Gifford Fund were valued on 12 March 2020, at £7.0490 per unit.

• Fidelity was unable to comment on the dealing/cut off times agreed by other platform providers.

On 24 April 2020, Mrs I telephoned Fidelity and highlighted that Fidelity had provided incorrect information in the Sale Confirmation Letter. Mrs I pointed out that information on the cut off times, in respect of the Baillie Gifford Fund, was not available on Fidelity’s website or in any of its literature.

On 30 April 2020, Fidelity wrote to Mrs I and advised:-

• The Sale Confirmation Letter was incorrect as it should have said that the valuation date was 12 March 2020. This error was partially caused by a delay in the Baillie Gifford Fund Manager sending Fidelity confirmation of the unit price post sale.

• Mrs I was incorrectly told that a correction would be made to the SIPP. The instruction to sell the units in the Baillie Gifford Fund was received on 11 March

2 CAS-56878-Q0F5 2020, so she was only entitled to have the units valued on the next working day (12 March 2020).

• Fidelity does not provide specific information on cut off times on its website. If a SIPP member has a specific question concerning a particular fund, they should contact Fidelity’s helpline.

• Fidelity was prepared to offer Mrs I £150, in recognition of the incorrect information it provided in the Sale Confirmation Letter and during the subsequent telephone conversation she had with Fidelity.

On 28 May 2020, Mrs I telephoned Fidelity to query the cut off time, and pricing point, for the Baillie Gifford Fund. A recording of the conversation has been provided to The Pensions Ombudsman (TPO). The recording confirms that the representative explained that the cut off time was 4pm with a price point set for the next working day.

On 26 June 2020, Mrs I again telephoned Fidelity to query the cut off time and price point for the Baillie Gifford Fund. Mrs I said that she believes she was provided with incorrect information during the telephone call. She alleges that the call representative told her to get her unit sale instruction in as early as possible to secure a same day unit price.

Fidelity does not have a record of the 26 June 2020 telephone call. However, Mrs I has provided TPO with a recording of the conversation. The representative advised that the Baillie Gifford Fund had a cut off time of 4pm, with a valuation point of 10am. The representative also advised that any sale instructions should be provided as early as possible to meet the daily cut off time of 4pm.

On 27 June 2020, Mrs I emailed Fidelity and explained that she had recently telephoned its helpline. She was told that she needed to submit an instruction to sell units as soon as possible, and preferably in the morning, for the sale to be valued on the same day. Fidelity should correct the valuation date to 11 March 2020, and use the unit price of £7.522 that applied on 11 March 2020. Mrs I calculated that the value of the units in the Baillie Gifford Fund would have amounted to £23,447, as at 11 March 2020.

On 16 July 2020, Fidelity explained that the valuation date it had used was in line with the agreement Fidelity had with the Baillie Gifford Fund Manager. The offer of £150, in recognition that it had provided Mrs I with incorrect information, was reasonable in the circumstances.

On 27 July 2020, Mrs I requested that Fidelity amend the valuation date to 11 March 2020, and pay her an award of £1,474 to remedy the financial loss she had identified.

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Adjudicator’s Opinion

Mrs I did not accept the Adjudicator’s Opinion and the complaint was passed to me to consider. Mrs I provided her further comments which do not change the outcome. 4 CAS-56878-Q0F5 I have considered the additional points raised by Mrs I but I agree with the Adjudicator’s Opinion. Mrs I’s additional points are summarised below:-

• Mrs I has explained that she has sold units in the Baillie Gifford Fund on a number of occasions, through other providers. All of these providers offered same day valuation for sales instructed early in the morning. So, the agreement between Fidelity and the Baillie Gifford Fund Manager was highly unusual.

• Information on what Fidelity and the Baillie Gifford Fund Manager had agreed should have been made available on Fidelity’s website.

• Fidelity should provide sufficient redress to remedy her calculated loss of £1,473.72.

Ombudsman’s decision

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Anthony Arter CBE

Deputy Pensions Ombudsman

1 May 2024

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