…after taking advice from your bank? Did you lose money? If so, help might be at hand.
For financial advice to be considered suitable the adviser has to understand you, the client’s personal circumstances fully and satisfy the principle of ‘Know Your Customer’. This means that he should have taken account of your assets and liabilities, income and expenditure, future plans, tax situation, protection requirements, investment experience and attitude to risk before recommending a suitable investment.
With interest rates being at an all time low, customers are often encouraged to take some risk in order to obtain potentially better returns. However, even agreeing to a ‘cautious’ investment can lead to customers being placed into a stock market linked product, often resulting in significant losses.
Your adviser should have provided you with a report called a Suitability or Reasons Why Letter, this should detail the discussions held and why the solutions have been recommended. It is important to read this carefully as it must accurately document your circumstances and attitudes.
If you have lost money then I suggest you firstly read that report. If you feel it does not fully reflect your recollection of events then contact the adviser or bank expressing your concerns. The bank must investigate your complaint and issue a final answer within 8 weeks. If you are not satisfied with the response you get, you have the right to take your complaint to the Financial Ombudsman Service (FOS) for an independent review.
Remember, the bank cannot claim that just because information has been provided to you in writing, it is sufficient to justify the recommendations. They must ensure that you completely understood the risks involved. It is often sensible to seek expert advice in these sorts of situations.
By Michael Jordan
Head of Investment Claims