Financial mix up cut a huge lump from my pension

I was contacted last year by the human resources consultant Mercer, which told me that, as I had left my job, I had to leave the company's pension scheme. I had the choice of a refund cheque, which meant I would lose my employer's contributions, or transferring into another scheme. To confuse matters, I had recently moved temporarily from the UK to Luxembourg. I decided to switch to a new pension. The deadline to leave the scheme was close and I asked a financial adviser, the Spectrum Partnership, to help with the process. It asked me to a meeting in London. On 28 September, Spectrum said it had submitted the application to transfer my pension to Aegon. Mercer had granted me several extensions to the deadline, finally to 8 October, so I assumed all was fine. On 29 October, Mercer sent me a cheque for £3,898 saying it had not received the relevant documentation so it was issuing a refund. I had to pay tax on it and have lost my employer's contributions. SF, Luxembourg Spectrum said you missed the deadline because Aegon lost your documents for two weeks. By the time Aegon sent in the transfer request, Mercer had already started the refund process. Aegon points out that sending paperwork on 28 September to be completed by 8 October was extremely tight but adds that it was not told there was a deadline. If it had known, it would have requested a further extension. It does admit, though, that it was responsible for a delay in requesting the money from Mercer. Because of that, it has agreed to restore the employer's contributions you lost. If it had met the deadline, you would have received £11,523 instead of £3,898. You can choose to have £7,625 credited to your bank account or added to your new pension policy. There is another element to this business that you were unaware of: whether Spectrum Partnership should have dealt with someone living outside the UK. To comply with EU legislation, UK advisers must be authorised in the overseas country, or obtain a "passport" from the Financial Services Authority. The Spectrum Partnership does not have this. The firm is fully aware of the regulations and discussed your situation with its compliance adviser before accepting you as a client. It believes that it complied, as you met up in London and still have a UK address. It also asked you to sign a letter saying you were not seeking advice but just asking the firm to transfer your pension. Spectrum then communicated with you by email which, it says, is the same as speaking to someone on the phone and complied with the regulations. But the FSA says that, if a firm arranges a transaction by telephone or internet from another EEA country, it should have a passport. That is for them to sort out. Spectrum reduced its fee from £300 to £250 because it had earned higher than expected commission from Aegon. For this sort of work, it expects to receive up to £1,000 in total but has agreed to cancel completely the fee it was charging you. • Email Margaret Dibben at [email protected] or write to Margaret Dibben, Your Problems, The Observer, Kings Place, 90 York Way, London N1 9GU and include a telephone number. Do not enclose SAEs or original documents. Letters are selected for publication and we cannot give personal replies. The newspaper accepts no legal responsibility for advice.