Nigel Callaghan has demanded full compensation for his clients
A leading firm of financial advisers is demanding that Standard Life reimburses all the savers who have lost money investing in its Pension Sterling Fund.
Hargreaves Lansdown, says Standard Life "bears sole responsibility" for its clients' losses.
About 97,000 people lost an average of £900 each when the insurer cut the value of the fund by 5% this month.
Hargreaves Lansdown says Standard Life mislead it, and its clients, about the safety of the fund's investments.
"We are writing to Standard Life on behalf of all affected clients to express our dismay over this matter and requesting full compensation for all our clients," said Nigel Callaghan, a pension adviser at Hargreaves Lansdown.
"Much of Standard Life's marketing literature referred to this fund as being 'wholly invested in cash - the most stable of investments'.
"However, it transpires that the fund also invested in less stable investments including some asset backed securities and mortgage-backed investments," he added.
Nearly half the fund is still invested in the "mortgage backed" assets which were responsible for the 5% cut in the fund's value announced on 13 January.
Standard Life has defended the underlying investment policy of the fund, until recently worth £2.4bn.
Keith Skeoch of Standard Life has defended the fund's investments
This week the group's chief investment officer, Keith Skeoch, told his shareholders that there had not been any investment in "toxic" assets, of the sort responsible for the huge losses currently plaguing the international banking system.
"There is no exposure to US sub-prime, CDOs or CLOs, in this fund," he told them.
"They are triple AAA and largely prime residential, with a dollop of non-conforming, but they are all very, very good, highly-rated, triple AAA assets, that we believe will generate good value in the long term," he added.
But this has cut little ice with Mr Callaghan.
"These are an investment class that has got many institutions into trouble over the last twelve months," he said.
"This is where the problem with the fund lies."
The insurer is in the process of calculating "remediation" for people who invested between 23 December 2008 and 13 January, the dates when the company says it realised the fund's assets had fallen in value and when it announced the fact to its savers.
Despite its assurances, Standard Life now faces a revolt by independent financial advisors (IFAs), who are responsible for channelling their clients' money into its funds.
Many have commented on the issue at the online forum of the investment adviser website citywire.co.uk.
"Imagine my surprise when these funds have been re-priced and my clients have lost money," said John Pemberton.
"There are some extremely angry clients out there at present. Standard should be forced to compensate investors," said Steven Gore.