Hammond said: "I also want to again emphasise here that I do not say that Rowanmoor was under any obligation to advise Mr T on the Sipp and/or the underlying investment.
"Refusing to accept an application because it was introduced by a firm that Rowanmoor ought reasonably to have known was not advising customers on the underlying investment, is not the same thing as advising Mr T on the merits of investing and/or transferring to the Sipp."
Hammond pointed out the high risk level of the investment and the sheer volumes of business, which should have sparked a review from Rowanmoor according to TCF principles.
There were also unregulated parties involved in promoting the TRG investment and RealSipp was misrepresenting its relationship with Rowanmoor, he said.
Hammond said Rowanmoor should have checked with CIB about how it came into contact with potential customers, what its arrangements with TRG were, what exactly RealSipp was doing as the “administrator for the packages”, how and why retail customers were interested in making these investments, whether anyone else was providing information to customers, how it was able to meet with or speak with all customers, and what marketing material was being provided to customers.
He said: "I think if Rowanmoor had carried out the due diligence I’ve set out above, it would have discovered that most if not all customers introduced by CIB had not received regulated advice about TRG from CIB or anyone else.
"It would have identified its own requirements for accepting business were not being met, and should have known there was a significant risk of consumer detriment as consumers were transferring/switching their existing pension schemes to invest entirely in TRG without the benefit of regulated advice."
He added: "Whilst I accept that CIB is responsible for initiating the course of action that has led to his loss, I consider that Rowanmoor failed to comply with its own regulatory obligations and did not put a stop to that course of action when it had the opportunity and obligation to do so.
"Rowanmoor didn’t have to carry out an assessment of Mr T’s needs and circumstances in order to meet its regulatory requirements, but it did have to treat Mr T fairly under the principles.
"I am satisfied that in the circumstances, for all the reasons given, that it is fair and reasonable to conclude that Rowanmoor should compensate Mr T for the loss he has suffered."
Th Fos is currently handling 886 complaints against Rowanmoor that involve due diligence, the majority in relation to The Resort Group.
They said the current case was one of a number of "sample cases" it was looking at, adding: "Under the DISP resolution rules Rowanmoor is required to take account of previous ombudsman decisions when considering complaints. Therefore our work on the complaints against Rowanmoor is ongoing."
