The Dutch financial markets authority (AFM) has issued a €136,000 fine to Pensioenfonds Detailhandel because it failed to inform tens of thousands of members about changes in their pension, the AFM announced on Thursday.
The €29bn pension fund for the retail sector, with 352,000 active members, had failed to send letters to tens of thousands of new participants, members approaching their pension and participants who quit their jobs in 2021 and 2022.
The letters to new participants also contained incorrect information about the starting date and/or amount of their pension accruals. In addition, the pension fund was also late in sending the annual pension overview to nearly 60,000 participants.
According to AFM, it is a “serious” matter that the fund failed to comply with its obligations to timely provide information to its members as this could disadvantage them financially.
If participants receive information about pension choices too soon before their retirement date, they have too little time to make good choices, said AFM. Some 2,550 participants received that information less than two months before their retirement, while 38 participants did not receive anything until after their pension had already started.
The investigation was launched in response to “signals” the AFM received, according to a spokesperson. Without giving details, he added that such signals could have come from participants.
AFM has reduced the original amount of the fine of €625,000 to €160,000 to make sure the fund’s members “would not be hit disproportionally” by the fine. Because Pensioenfonds Detailhandel acknowledged the violations and accepted the fine, the AFM reduced it by another 15% to €136,000.
While acknowledging its mistakes, the pension fund did not fully agree with AFM’s verdict, calling it “too firm”. According to the pension fund, the regulator “has made too far-reaching conclusions based on a limited survey sample, which could not be based on the research conducted by AFM.”
The regulator dismissed the fund’s complaints.
Pensioenfonds Detailhandel blamed the mistakes on technical issues related to the transition from its former pension administrator TKP to Capgemini.
Detailhandel has had trouble with its new administrator ever since it switched to the French IT firm in 2021. Besides, the fund also attributed the mishaps to COVID-19 and the obligation to work at home.
“We deeply regret this. Fortunately, there has been no financial disadvantage for participants,” said a spokesperson for the fund.
This article was first published on Pensioen Pro, IPE’s Dutch sister publication. It was translated and adapted for IPE by Tjibbe Hoekstra