DRN-6227261

The complaint Mr B complains that an adviser working for OpenWork Limited gave him unsuitable advice and took excessive commission without providing the required ongoing services. What happened Our investigator set out the background to this complaint in his letter of recommendation, for ease of reference I have included an amended copy of this below: On the 16 January 2008, AF wrote to Mr B setting out his recommendation that Mr B takes out an Aegon stakeholder plan. AF was a financial adviser at 2mtrust, an appointed representative of Openwork Limited. The fact find and recommendations report noted that Mr B: • Was 26 and married and had no dependants. • Was a self-employed mortgage adviser working for 2mtrust. • Was receiving an annual income of £45,000 and his monthly disposable income was £825. • Had no access to an employer’s or occupational pension scheme • Wanted to invest to provide an income in retirement. • The recommended contribution level was £156 a month net (£200 a month gross), The adviser referred to the importance of ensuring the recommendation was affordable. • Having reviewed the income and expenditure he noted that it was agreed that the contribution level was affordable now and in the foreseeable future. • Mr B was happy with the stakeholder product and wanted premiums to increase in line with National Average Earnings. An illustration was provided which included information about how much the advice would cost and referred to having left Mr B with these documents. The adviser also said that he provided Mr B with “Keyfacts about our services” and “Keyfacts about the cost of our services” which he said provided details of the companies’ products he could recommend and how he was paid. In addition, he stated that he enclosed a “Pension Recommendation Summary” and “Plan Information.” The Plan Information included details of the charges on the plan which were limited to an annual management charge on the funds of 1.5% reducing to 1% after 10 years. The illustration provided also included the information about the charges and advice costs. This confirmed that for arranging the plan the provider would pay the adviser £35 each

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month for 27 months and then £5 a month thereafter until your chosen retirement age which was 65. A risk questionnaire was also completed which recorded Mr B’s answers to various risk based questions. These included the following: “When it comes to investing, how would you describe yourself?” Out of the various options it recorded that you had “A high level of understanding/knowledge”. “If your investments dropped by 20% how would you react?” It recorded that Mr B would “Hold the investment and sell nothing”. “What are your main investment goals?” it recorded “Long term growth (over 10 years)”. “When you make a significant financial decision how would you normally feel afterwards?” it recorded you would feel “Very confident”. “On a scale of 1 to 6, what level of volatility are you prepared to accept?” It recorded that you were willing to accept “6 = high volatility, you are aiming for the highest gains”. Each answer had a score attached and based on the overall total this indicated Mr B was an “adventurous” investor. In the section “Investor knowledge and experience” it recorded Mr B as being an “Experienced investor”. It stated, “Mr B feels that he is an experienced investor as he had a number of Buy to Let Properties and works within financial services as a mortgage adviser. He therefore wanted to choose a fund of his own to go alongside my recommendation.” The recommendation noted that it was agreed Mr B was an adventurous investor and the adviser said he recommended a fund that matched the risk profile. It confirmed that the contributions would be invested into the “Dynamic Lifestyle” and “Global Equity tracker lifestyle” funds. Both of which Aegon records as being medium to high risk funds. AF said that the recommendation letter summarised what had been discussed and set out his recommendation that Mr B take out an Aegon Scottish Equitable stakeholder pension plan. Regarding regular reviews he stated that “My recommendation is based on your current circumstances and needs and the relevant information you gave me. It is important that you regularly review your plans to make sure that they continue to meet your needs. A regular review of your pension objectives, the funds you’re invested in and your own individual circumstances is important and highly recommended. If at any time you would like help reviewing your plans, please contact me.” The investigator also contacted Openwork and Aegon about the plan. They confirmed that the plan started on 18 January 2008. In addition to the index-linked increases, further increases were processed in May 2009 and March 2012 for £25 and £69 a month respectively. Openwork said that no commission payments were received in respect of this plan after September 2014. With regard to the Zurich Life insurance policy, Openwork said that Mr B had been a mortgage adviser with them and was authorised to sell the product he was complaining about. In their final response to the complaint dated 4 November 2025 they said they couldn’t see that the Zurich plan was taken out through Openwork and therefore they had no records about the sale.

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The investigator contacted Zurich Life regarding the policies Mr B held. They confirmed the following information: A term assurance and critical illness policy which started in October 2001 and provides cover until 30 September 2026. The original “Servicer” on the plan was Acorn and this changed to 2mtrust from October 2004 to December 2013. A term assurance policy which Zurich said started in April 2007 and lapsed with effect from 1 October 2016. Commission for setting up this plan Zurich said was paid to Mr B. A life assurance and critical illness plan that started in 2007 and lapsed on 1 January 2019. Commission they said was paid to Future Perfect Financial Solutions. They also provided some documents about these plans which the investigator attached for Mr B’s information. Openwork didn’t uphold Mr B’s complaint and dissatisfied with their reply he referred his complaint to our service to review. On the complaint form Mr B completed he said that Openwork had failed to properly address the issues of the initial mis-selling, and the failure to provide annual suitability reviews relating to the products arranged through their adviser MT. Mr B said that Openwork had put the onus on him as a consumer to have self-assessed these products. However, Mr B stated he was only ever authorised, qualified and trained as a mortgage adviser and worked for 2mtrust from 2003 to 2013. Our investigator looked into matters but didn’t uphold the complaint, he said the Stakeholder recommendation appeared suitable and the charges that applied were set out. When the commission was set which was prior to the Retail Distribution Review, there was no requirement for ongoing advice. The investigator said there was no evidence that there was a contractual agreement for future services. With regard to the life insurance, the investigator said Openwork was not responsible for the sale of the policy. He said it was possible commission was paid to it when it took over the policy but there was no evidence any reviews were contractually agreed. And as Mr B was authorised to provide advice on this type of product, he’d expect Mr B to be in a position to ensure ongoing suitability of it. In response Mr B said the investigator had talked about another adviser but at all times it had been MT who had advised him. He said the investigator hadn’t commented on the fact the commissions had been loaded and was never disclosed to him. He feels he has overpaid on all the policies and MT has benefited from this. In response the investigator said: • Records clearly showed AF to be the adviser at the point of sale and the investigator didn’t consider the sale unsuitable in any event. • The commission being loaded wasn’t the complaint submitted but instead the suitability was questioned and the ongoing advice not being carried out. The investigator said the evidence shows it wasn’t sold by the adviser MT and whilst he may have received commission there appeared to be no agreement for ongoing advice.

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Mr B still didn’t agree and therefore asked for an ombudsman to decide the case. 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. And having done so I agree with the outcome reached by our investigator and for broadly the same reasons. Mis-sale of pension and lack of ongoing services provided Mr B’s complaint is about the service and suitability of advice given by a specific adviser MT, but the evidence shows that the recommendation was instead made by AF, another adviser at 2mtrust. In any event, at the time Mr B had no pension provision, so I think the recommendation of a Stakeholder pension to start accruing benefits for retirement was suitable. The evidence from the time suggests it was affordable; the funds selected were in line with his attitude to risk and the charges were set out. Mr B believes he didn’t receive the annual reviews he was due but as the investigator set out, there wasn’t a contractual agreement to provide annual reviews. The letter of recommendation said: So, there was an open invite to request a review, not an agreement to provide them annually. The complaint is that MT didn’t take up the mantle so to speak and provide these reviews, but I don’t think there was any reviews to provide – certainly not contractually. When Mr B received advice to take this product out, commission could continue without the requirement for ongoing advice. In 2013 The Retail Distribution Review (RDR), meant that this practice couldn’t continue for new sales, fees had to be upfront and ongoing services had to be provided if charges were ongoing but there was no requirement for existing agreements to be amended. So, in taking commission and not providing ongoing reviews, I cannot say Openwork were doing anything wrong. The commission paid was in line with the contractual agreement from the outset and the relevant legislation. And in any event the commission payments stopped in 2014 shortly after RDR. The fact that ongoing commission was taken without reviews seems to be the basis for much of Mr B’s complaint for this product and the life insurance but I’m afraid he is mistaken that ongoing reviews were part of what 2mtrust and MT needed to provide. And the ongoing commission wasn’t taken unfairly or out of line with legislation. Mis-sale of life insurance and lack of ongoing services provided The evidence shows that Openwork wasn’t responsible for the initial sale, so the suitability of the advice isn’t something I can consider here. Again, there is no evidence of any requirement to provide further advice on this product when it was taken over by 2mtrust. And Mr B worked for 2mtrust and was regulated to provide advice on this product, so he should’ve been aware of what was required in terms of his needs. Mr B believes the commission was loaded and he overpaid for the products. But as I’ve said

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the initial sale of the life insurance product wasn’t made by 2mtrust (Openwork) and the charges and commission was set out clearly for the Stakeholder pension. I’m not sure on what basis Mr B believes he has overpaid or that the commission was loaded but if he is applying current standards then I’m afraid that is not relevant to sales that occurred decades ago. And notably in a time where payment was taken over many years rather than upfront. Mr B may have paid higher ongoing fees than would be seen now but then he didn’t pay a comparatively large sum at outset as is now standard. My final decision For the reasons explained above, I do not uphold this complaint. Under the rules of the Financial Ombudsman Service, I’m required to ask Mr B to accept or reject my decision before 6 May 2026. Simon Hollingshead Ombudsman

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