THIRD PARTY INVESTMENT ACCOUNT QUESTIONS & ANSWERS. Embark platform Embark Third Party Investment Account Key Questions & Answers

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1 THIRD PARTY INVESTMENT ACCOUNT QUESTIONS & ANSWERS 1

2 CONTENTS 3 QUESTIONS & ANSWERS 6 OTHER INFORMATION 7 HOW TO CONTACT US The Embark Third Party Investment Account, the Account, is a general investment product provided by Embark Investment Services Limited, trading as Embark platform. Embark Investment Services Limited is authorised and regulated by the Financial Conduct Authority (FCA). Unless otherwise agreed with us it is only available to pension trustees through a financial adviser. The Account provides access to a wide range of investments that have the potential to provide capital growth and income. Note: Where we have agreed to open an Account for you without a financial adviser, please treat all references to financial adviser obligations or responsibilities in this document as meaning your obligations or responsibilities, or as not applicable, whichever the case may be. 2

3 QUESTIONS & ANSWERS WHAT CAN THIS ACCOUNT OFFER? Through this Account: investments could achieve potentially higher returns than savings in a regular bank or building society account funds can be invested in mutual funds or equities directly or a combination of both funds can be invested via discretionary investment managers who will help to manage investments in the Account. HOW IS A THIRD PARTY INVESTMENT ACCOUNT (TPIA) OPENED? Once the pension trustees have approved the Embark TPIA as appropriate to be held within their pension, a financial adviser will then set up the Account in accordance with the Client Terms & Conditions (with the specific TPIA terms). HOW MUCH CAN BE SAVED IN A TPIA? A TPIA can be started with a minimum transfer from the Pension Trust bank account of 5,000. There is no maximum amount that can be transferred into an Account. The Embark TPIA can accept the following payments in: One-off payments from the Pension Trust bank account A re-registration transfer of investments held elsewhere These payments can be made electronically by Direct Credit (BACS, CHAPS, or Faster Payment). WHAT ARE THE CHARGES? The following shows the type of charges that could be applied to an Account depending on the services chosen. Charges are deducted from the available cash within an Account. A more detailed description of our charges is in the Client Terms & Conditions. To find out the actual charges, refer to the Embark Client Charges Guide, and the Charges Information document. Ongoing and ad-hoc charges include: ongoing Embark platform charge ongoing financial adviser charge Discretionary Investment Manager charge ad-hoc financial adviser charge manual communication charge applicable Stockbroker Partner charge. HOW WILL THE PENSION TRUSTEES KNOW HOW THE ACCOUNT IS DOING? There are several ways to keep up-to-date with how the Account is performing: Trustees and financial advisers can get an up-to-date valuation of the investments at any time by signing into the Embark Account online. The address provided upon registration will be used to provide a secure username and password. Refer to the Managing The Account section. We provide a statement every three months showing the value of the investments in the Account. The first statement is produced three months after the Account is opened and placed in the Document Library. WHAT ABOUT TAX? The Embark TPIA is an Account within the Pension Trust, and subject to relevant tax legislation, income and capital gains from investments within the TPIA will be received on a tax free basis. Any questions around the taxation of pension investments are a matter for the pension trustees and/or the appointed financial adviser. The initial charges include an initial financial adviser charge. 3

4 MANAGING THE ACCOUNT The Account is set up and managed online by your financial adviser, who will complete all transactions for the pension trustees; including: setting up new transfers from the pension trust bank account changing the investments the pension trustees are investing in setting up any financial adviser charges making withdrawals making any other changes. When the financial adviser opens an Account, the pension trustees will be given access to view each new Account online. This will allow them to see: which investments are held the value of those investments and how they are performing any charges applied any Account literature (placed in the Document Library). TERMINATING THE RELATIONSHIP WITH A FINANCIAL ADVISER? As the Embark TPIA is set up and managed for clients by a financial adviser, it is important that if the appointment of the existing financial adviser is terminated, a new financial adviser should be appointed as soon as possible. Appointing a new financial adviser could mean there are changes to our platform charges and to the financial adviser charges that are paid. The pension trustees should check these details with the new financial adviser before proceeding. If the appointment of the financial adviser is terminated and a new one is not appointed, we will restrict some Account features. We will apply a higher ongoing platform charge to cover the extra costs of administration on the TPIA Account. This charge will continue to be applied until a new financial adviser is appointed. However, each investment will have specific investment risks associated with it and the financial adviser will tell you what these are. The range of investments we make available include: mutual funds exchange-traded instruments (ETIs) including securities mutual funds and ETIs contained in model portfolios. The pension trustees can find out more about these types of investments from the financial adviser or in our Client Terms & Conditions. All investments eligible for the Embark TPIA will be available for selection by your financial adviser. Where a Pension Trust has specific investment selection criteria that need to be observed when selecting investments to be held within the Embark TPIA, such criteria and restrictions will need to be agreed with the financial adviser as a contractual term of the financial adviser s appointment. WHAT ABOUT CASH? Within each Account we offer a cash facility. We do this by providing access to a bank account operated by our banking partner. This bank account is not unique to the Account. It holds money for all Embark platform investors centrally. WHAT IS A DISINVESTMENT STRATEGY? If we are due to take money from the Account to pay our charges or comply with any contractual obligations the Pension Trustees have or to facilitate financial adviser charges and there is not enough available cash we may automatically disinvest from investments within the TPIA. This action will raise cash so the charges and costs can be applied. Where investments are held in a model portfolio and there is insufficient cash available to cover charges, the investment within the model portfolio may be sold to raise cash to cover these. More information about our disinvestment strategies can be found in our Client Terms & Conditions. The Client Terms & Conditions provide more detail on the consequences of leaving your financial adviser. WHAT INVESTMENTS CAN BE HELD IN A TPIA? We will never advise or instruct the pension trustees on investing pension money. 4

5 CAN INVESTMENTS WITHIN THE TPIA BE CHANGED? Yes, you can ask your financial adviser to make changes to your investments. The financial adviser is able to: buy and sell investments distribution payments dividend payments interest payments. More information on these payments is available from your financial adviser or in our Client Terms & Conditions. switch investments. If the investments are held within a model portfolio, the discretionary investment manager may also instruct us to buy and sell investments when necessary to rebalance the model portfolio. This is done to make sure that the overall objective of the portfolio is maintained. In some instances, there may be restrictions on the sale of investments, for example, if an investment is suspended from trading or where there are restrictions on when an investment can be sold. CAN THE MONEY BE TAKEN OUT? Yes, your financial adviser can arrange either one-off or regular withdrawals at any time. We do not apply any charges for taking money out of the Account, however there may be charges involved in selling certain investments. Any money that is paid out can only be paid into a single bank account in the name of the pension trustees. Regular withdrawals Regular withdrawals can be made either monthly, quarterly, half-yearly or yearly. Such withdrawals must be taken from available cash in your Account. The financial adviser may need to give instructions to sell investments to generate cash. Regular withdrawals can be stopped and re-started at any time when we are able to facilitate it. There is no charge for doing this. One-off withdrawals A one-off withdrawal can be made at any time. One-off withdrawals must be taken from available cash in your Account. Your financial adviser may need to give instructions to sell investments to generate cash for such withdrawals. There is no charge for this. WHAT ARE DISTRIBUTION, DIVIDEND AND INTEREST PAYMENTS? CAN A TRANSFER OF ASSETS BE MADE FROM ANOTHER TPIA ARRANGEMENT? Your financial adviser will be able to inform you of which products we would accept through a transfer and whether or not transferring is the right option, together with the benefits and risks involved. Any transfer will require the agreement of the pension trustees. If a transfer progresses, we will normally receive the money in as a cash transfer. We may allow a re-registration transfer in on a case-by-case basis. Where this is required, the financial adviser should contact us to discuss. CAN THE ACCOUNT BE CASHED IN OR A TRANSFER OUT ARRANGED? Yes, your financial adviser can instruct us to sell all investments and arrange payment to the Pension Trust bank account at any time. The pension trustees could also instruct us to transfer or re-register the investments to another provider where the other provider agrees to accept the investments held in the Embark TPIA. We may allow a re-registration transfer out on a case-bycase basis. Where this is required, the financial adviser should contact us to discuss. WHAT HAPPENS IF THE MEMBER OF THE PENSION TRUST DIES? In the event of the death of the member, the pension trustees will instruct a return of monies from the Embark TPIA to the Pension Trust bank account, thereby enabling the pension trustees to provide death benefits in accordance with the Pension Scheme Rules. Any adviser charges and discretionary investment manager charges will be stopped at that time. Depending on the type of investments held, the Account may be eligible to receive a certain type of income payment from an investment. These payments are not guaranteed and can go down as well as up. The different types of income payments are: 5

6 OTHER INFORMATION HOW TO COMPLAIN If you are unhappy with the way you have been treated by us, you always have the right to complain. You can write or call us at the address and number in the How to Contact Us section. If you are not satisfied with our response, you can then raise the issue with: Financial Ombudsman Service Exchange Tower London E14 9SR Phone: Website: financial-ombudsman.org.uk Referring the matter to the Ombudsman will not affect your right to take legal action later on. TERMS & CONDITIONS This document provides key questions and answers related to the Embark TPIA. It does not include all the definitions, exclusions and terms and conditions. Pension trustees can find full details in our Client Terms & Conditions, available on our website. We will also provide an electronic copy in the pension trustees Document Library if they decide to buy an Embark TPIA. We have the right to make changes to the Client Terms & Conditions. If this happens, we will let the pension trustees know and explain the changes. Any changes will be added to the Document Library and posted on our website. In the event of a conflict between the Embark Client Terms & Conditions and this Questions & Answers document, the Embark Client Terms & Conditions will prevail. CLIENT CATEGORISATION We categorise all of our clients as Retail Clients under the FCA rules for all services and transactions. This helps us to make sure that you receive appropriate disclosure documents from us and that the pension trustees are told everything they need to know in a timely fashion. COMMUNICATION Our contract is in English and all future communication about it will be in English. FINANCIAL SERVICES COMPENSATION SCHEME Embark platform is authorised by the FCA so the pension trustees will have access to the Financial Services Compensation Scheme (FSCS). In the event the Pension Trustees suffer financial loss because of our failure or an investment failure, the actual level of compensation the pension trustees will receive will depend on the basis of the claim and where the money the pension trustees had with us is invested. The FSCS only pays compensation for financial loss. Compensation limits are per person per firm and per claim category. The FSCS may be able to pay compensation if we or any banks with whom we place pension money are no longer able to meet our or their financial obligations. If certain investments fail, the pension trustees may also be eligible for compensation. In the unlikely event Embark platform fails, the pension trustees may be eligible for compensation up to 50,000. For cash held on deposit the pension trustees may be eligible for compensation up to 85,000. If an investment fails, the pension trustees may be eligible for compensation of up to 50,000 per investment. The pension trustees can find out more about the FSCS and how it covers pension savings in our Client Terms & Conditions. LAW The Embark TPIA will be set up and governed in accordance with the laws of England and Wales. The pension must be registered under Part 4 of the Finance Act 2004 (unless we agree otherwise) in order to open an Embark TPIA on the Embark platform. 6

7 HOW TO CONTACT US HOW TO CONTACT US If the pension trustees have any questions about the Embark TPIA they should contact the financial adviser in the first instance. If the pension trustees feel that they need to contact us, they can do so using any of the methods below. By mail: Embark platform PO Box Tanfield Edinburgh EH3 1EY By service@embarkplatform.co.uk By telephone: Available Monday to Friday 9am to 5pm. Calls may be recorded for training purposes. 7

8 Embark platform PO Box Tanfield, Edinburgh EH3 1EY // embarkplatform.co.uk Embark platform is a trading name of Embark Investment Services Limited, a company incorporated in England and Wales (company number ). Embark Investment Services Limited is authorised and regulated by the Financial Conduct Authority (Financial Services Register number ). Registered office: 7th Floor, 100 Cannon Street, London EC4N 6EU. EP KFD-TPIA 07/18