Some pensions Or Investments Involved Poor Returns Or Inappropriate Risk or Unacceptable Fees

Investment Disappointments Despair?
Hold your Financial Product Advisor To Account

Investment Shortfalls, Risk And Other Lender Let Downs

Investing can be a crucial part of long-term financial planning. However, investments can be mis-sold, leading to significant financial losses. Mis-selling occurs when financial advisors or institutions provide unsuitable advice, misrepresent the risks involved, or fail to disclose important information. This section explores the common reasons why investments might be mis-sold and what you can do if you suspect you’ve been affected.

Unsuitable Advice

Financial advisors have a duty to provide advice that is appropriate for your individual circumstances, including your financial goals, risk tolerance, and investment timeframe. Advice is considered unsuitable if:

• **Your Risk Profile Was Not Assessed:** The advisor did not adequately assess your attitude to risk. They should have discussed your comfort level with potential losses and your capacity to absorb them.
• **The Investment Did Not Align with Your Goals:** The investment recommended did not match your stated financial objectives. For example, if you were saving for retirement in 20 years but were advised to invest in a high-risk, short-term investment, the advice would be unsuitable.
• **Insufficient Information Was Gathered:** The advisor did not gather enough information about your financial situation to make an informed recommendation.
• **Conflicting Interests:** The advisor had a conflict of interest, such as receiving higher commissions for recommending certain products, which influenced their advice.

Risk Misrepresentation

It is crucial that the risks associated with any investment are clearly explained. Mis-selling can occur if:

• **Risks Were Downplayed:** The advisor minimized or misrepresented the potential for losses. All investments carry some level of risk, and it is essential to understand the worst-case scenarios.
• **Complex Products Were Not Explained:** You were advised to invest in complex financial products without fully understanding how they work or the risks involved. These could include derivatives, structured products, or unregulated investments.
• **Past Performance Was Misleading:** Past performance is not a guarantee of future returns. It is misleading to suggest that an investment will continue to perform well based on its historical performance.

Lack of Disclosure

Financial advisors must disclose all relevant information about an investment, including:

• **Fees and Charges:** All fees, commissions, and charges associated with the investment should be clearly disclosed. Hidden or excessive fees can significantly impact your returns.
• **Potential Conflicts of Interest:** Any potential conflicts of interest, such as commissions received from specific providers, must be disclosed.
• **Terms and Conditions:** You should be provided with all the terms and conditions related to the investment, including any restrictions or penalties.

Making a Complaint

If you believe you have been mis-sold an investment, you can make a complaint. Here are the steps to follow:

1. **Gather Evidence:** Collect all relevant documentation, including investment agreements, financial advice records, correspondence with the advisor, and any evidence of your financial situation at the time of the investment.
2. **Contact the Firm:** Make a formal complaint to the financial firm involved, clearly outlining your concerns and the reasons why you believe the investment was mis-sold. Provide the evidence you have gathered.
3. **Internal Dispute Resolution:** Follow the firm’s internal complaints procedure. They are required to have a process for handling customer complaints.
4. **Financial Ombudsman Service (FOS):** If you are not satisfied with the firm’s response, you can escalate your complaint to the Financial Ombudsman Service. The FOS is an independent body that can help resolve disputes between consumers and financial businesses.
5. **Seek Legal Advice:** For complex cases or significant losses, it is advisable to seek legal advice from a solicitor specializing in financial mis-selling.