Mis-sold investments
Discussion
Hi could anyone point me towards the best course of action, found out today the mother in law (who is 72) has been sold a Aviva bonds plan after going into her local high street bank. She only wanted to have her money put into a saving account which is what she thought she had got until she went to try and withdraw some money out to buy a new car. There's no way she would have anything to do with "investments" and feels totally cheated,upset and foolish. The money is worth £18,000 from the original amount of £20,000 and she has had no income from it. I am going into the bank with her monday morning and expect to be fobbed off.
Edited by caterhamboy on Sunday 14th February 23:42
You will have some difficulty as your mother would have received a letter following the investment detailing what was done, investing over the medium to long term and making no reference to savings accounts. She would have had 30 days from receipt of the letter to change her mind if she realised something was amiss and Natwest are likely to argue that the fact that she did not cancel it was in effect, confirmation that she understood the contract.
All you can do is plead to their better nature - which will get you nowhere. Then complain to their head office that your mother did not realise that her money went into something other than a 'savings account'. The difficulty is proving that she did not understand at the time, rather than that she is now unhappy that the investment has gone down and is looking for a way to get her money back.
Unfortunately, stories of the bank 'advisers' investing clients' monies into unsuitable products are on the rise, the only advice I can give is stand your ground.
All you can do is plead to their better nature - which will get you nowhere. Then complain to their head office that your mother did not realise that her money went into something other than a 'savings account'. The difficulty is proving that she did not understand at the time, rather than that she is now unhappy that the investment has gone down and is looking for a way to get her money back.
Unfortunately, stories of the bank 'advisers' investing clients' monies into unsuitable products are on the rise, the only advice I can give is stand your ground.
I understand your frustration but has she really been mis-sold? There are so many warnings and requirements to sign applications showing you understand what is being presented, and the Statement Of Advise she would have received would have had warnings and access info all over it.
If she signed to say she understood and agreed I would think she wouldn't have much to argue.
If the investment was now worth 22k would she be as annoyed?
Complaints wise go to the adviser in writing. They will have to respond within a certain time and then resolve within another. If still not happy then ombudsman.
More people are complaining as funds have gone down and obviously people are upset but that's because that's nature but that's also investment risk.
If she signed to say she understood and agreed I would think she wouldn't have much to argue.
If the investment was now worth 22k would she be as annoyed?
Complaints wise go to the adviser in writing. They will have to respond within a certain time and then resolve within another. If still not happy then ombudsman.
More people are complaining as funds have gone down and obviously people are upset but that's because that's nature but that's also investment risk.
Edited by Pommygranite on Sunday 14th February 03:29
you cant complain about falling values - only that she should not have been sold something with the possibility of such falls (risk). its also incredibly easy to sell someone something yet not have them see any (or most) of the required paperwork....so the idea that she went in knowingly may be wrong - yet VERY hard to prove if the bank has its paper trail in order.
It's not so much the loss of money that has upset her so, it's the fact that she has been tricked and lied too. Reading between the lines someone has seen an easy way to grab some commission regardless of the cost which reading the last few post there is no repercussion to. I have been googling and it does seem to be common practice with high street banks, It wouldn't be so bad if any of the investments were good instead they seem to be some of the worst performing on the market, probably as so many have had a cut from it. I will phone the fsa in the morning and go to the bank with her and hopefully the saleman will be there.
Thanks for the advice
Thanks for the advice
FSA
http://www.fsa.gov.uk/
Certainly what sounds like a long term investment product is not sounding ideal for a 72 year old who presumably is retired and requires income from their investments as well as a good level of safety for the capital as well.
The same thing happened to my grandfather when he was suffering from dementia. FSA ruled in his favour very quickly and bank staff received "futher training in selling investment products".
http://www.fsa.gov.uk/
Certainly what sounds like a long term investment product is not sounding ideal for a 72 year old who presumably is retired and requires income from their investments as well as a good level of safety for the capital as well.
The same thing happened to my grandfather when he was suffering from dementia. FSA ruled in his favour very quickly and bank staff received "futher training in selling investment products".
caterhamboy said:
Hi could anyone point me towards the best course of action, found out today the mother in law (who is 72) has been sold a Aviva bonds plan after going into her local Natwest. She only wanted to have her money put into a saving account which is what she thought she had got until she went to try and withdraw some money out to buy a new car. There's no way she would have anything to do with "investments" and feels totally cheated,upset and foolish. The money is worth £18,000 from the original amount of £20,000 and she has had no income from it. I am going into the bank with her monday morning and expect to be fobbed off.
She will complain to Nat West - details of who to make a complaint on the paperwork that she received.Her complaint should be that she thought she had some sort of investent account that she could make withdrawals from on demand and therefore does not understand the product. It was sold to her without her being able to make a balanced and informed choice.
When she gets a response (or if she does not get a "decision" as to whether the compaints department agree with her or not within a reasonable time - say 4-8 weeks) she will then take her complaint and present it to the Financial Ombudsman Service. they will adjudicate and decide.
For any of the rest of us to speculate on the outcome will be unfair to your M-I-L and her case.
Useful information to start with:
https://www.natwest.com/secure/global/contact_us/c...
http://www.financial-ombudsman.org.uk/consumer/com...
Here are my thoughts...
It's very unlikely that you'll get very far speaking directly with the adviser or even going to the bank.
Firstly, try to find out who is responsible for the advice that your mother received, as there is no point in complaining to the wrong firm. Next, look up the relevant complaint proceedures on their website.
As far as I am aware, both the FSA and the FOS will refer you to the firm in the first instance, so it's unlikely you'll get any joy here.
It is most likely that the sales documents will all be in order and will clearly explain the product sold. They will also have your mother's signature confirming her understanding of the product and that she wished to proceed. I would imagine they would also have issued a letter to your mother outlining the advice / sale and, as said before, she would have received details of her cancellation rights.
Your best angle is suitability of the product sold (if indeed it is unsuitable). What risks are involved with the plan? Can she loose capital? If so, they would have had to assess your mothers ability and willingness to take this risk. If its wrong, challenge on these grounds.
Is the money tied up or are there penalties for withdrawal? Does your mother have access to other funds or was this money a significant chunk of her money?
Basically, have a good think about if and why the sale was wrong and make a formal complaint, in writing, on this basis.
It's very unlikely that you'll get very far speaking directly with the adviser or even going to the bank.
Firstly, try to find out who is responsible for the advice that your mother received, as there is no point in complaining to the wrong firm. Next, look up the relevant complaint proceedures on their website.
As far as I am aware, both the FSA and the FOS will refer you to the firm in the first instance, so it's unlikely you'll get any joy here.
It is most likely that the sales documents will all be in order and will clearly explain the product sold. They will also have your mother's signature confirming her understanding of the product and that she wished to proceed. I would imagine they would also have issued a letter to your mother outlining the advice / sale and, as said before, she would have received details of her cancellation rights.
Your best angle is suitability of the product sold (if indeed it is unsuitable). What risks are involved with the plan? Can she loose capital? If so, they would have had to assess your mothers ability and willingness to take this risk. If its wrong, challenge on these grounds.
Is the money tied up or are there penalties for withdrawal? Does your mother have access to other funds or was this money a significant chunk of her money?
Basically, have a good think about if and why the sale was wrong and make a formal complaint, in writing, on this basis.
To clear a few things up, my mother in law thought she had invested in a fixed rate cash bond, she wanted no risk at all and just wanted somewhere to put her money. She doesn't need income off it and just thought it was sat there for her to use if required. Seems you can do as you please and as long as you know the rules and get them to sign something which any good salesman should be able to do.
Taken from the daily mail today and pretty much says that they hard sell. I'll see how i get on tomorrow but not expecting much.
Barrie Roberts, 58, from Stoke-on-Trent, Staffordshire, has worked as a bank adviser and is now a part-time financial adviser with Positive Solutions, an adviser network.
Barrie, who is married, says banks should be stopped from selling regulated financial products such as risky structured investments - where returns depend on stock markets - and investment funds. Such products have been widely mis-sold by banks, sometimes resulting in heavy fines from the Financial Services Authority.
'Often, customers don't understand the product they are signing up to,' says Barrie. 'To make matters worse, the staff don't understand the products. Then, when the investment plan matures, the bank salesperson has long gone, leaving the customer disenfranchised.'
Barrie says branch staff should not be under pressure to sell products by having a large chunk of their salary dependent on meeting sales targets. This view is shared by some bank branch staff who have contacted us anonymously.
One says: 'As a long-serving employee of an almost nationalised bank, this is going to be the worst year for its treatment of the lowly cashier. They are targeted daily to provide appointments to branch advisers as well as given targets to open new savings accounts. Their performance is monitored daily and highlighted on a large chart - the 'name and shame' board.
'If they do not perform, the bank can have them sacked within three months for non-performance.'
Read more: http://www.dailymail.co.uk/money/article-1250782/B...
Taken from the daily mail today and pretty much says that they hard sell. I'll see how i get on tomorrow but not expecting much.
Barrie Roberts, 58, from Stoke-on-Trent, Staffordshire, has worked as a bank adviser and is now a part-time financial adviser with Positive Solutions, an adviser network.
Barrie, who is married, says banks should be stopped from selling regulated financial products such as risky structured investments - where returns depend on stock markets - and investment funds. Such products have been widely mis-sold by banks, sometimes resulting in heavy fines from the Financial Services Authority.
'Often, customers don't understand the product they are signing up to,' says Barrie. 'To make matters worse, the staff don't understand the products. Then, when the investment plan matures, the bank salesperson has long gone, leaving the customer disenfranchised.'
Barrie says branch staff should not be under pressure to sell products by having a large chunk of their salary dependent on meeting sales targets. This view is shared by some bank branch staff who have contacted us anonymously.
One says: 'As a long-serving employee of an almost nationalised bank, this is going to be the worst year for its treatment of the lowly cashier. They are targeted daily to provide appointments to branch advisers as well as given targets to open new savings accounts. Their performance is monitored daily and highlighted on a large chart - the 'name and shame' board.
'If they do not perform, the bank can have them sacked within three months for non-performance.'
Read more: http://www.dailymail.co.uk/money/article-1250782/B...
caterhamboy said:
To clear a few things up, my mother in law thought she had invested in a fixed rate cash bond, she wanted no risk at all and just wanted somewhere to put her money. She doesn't need income off it and just thought it was sat there for her to use if required. Seems you can do as you please and as long as you know the rules and get them to sign something which any good salesman should be able to do.
Taken from the daily mail today and pretty much says that they hard sell. I'll see how i get on tomorrow but not expecting much.
Barrie Roberts, 58, from Stoke-on-Trent, Staffordshire, has worked as a bank adviser and is now a part-time financial adviser with Positive Solutions, an adviser network.
Barrie, who is married, says banks should be stopped from selling regulated financial products such as risky structured investments - where returns depend on stock markets - and investment funds. Such products have been widely mis-sold by banks, sometimes resulting in heavy fines from the Financial Services Authority.
'Often, customers don't understand the product they are signing up to,' says Barrie. 'To make matters worse, the staff don't understand the products. Then, when the investment plan matures, the bank salesperson has long gone, leaving the customer disenfranchised.'
Barrie says branch staff should not be under pressure to sell products by having a large chunk of their salary dependent on meeting sales targets. This view is shared by some bank branch staff who have contacted us anonymously.
One says: 'As a long-serving employee of an almost nationalised bank, this is going to be the worst year for its treatment of the lowly cashier. They are targeted daily to provide appointments to branch advisers as well as given targets to open new savings accounts. Their performance is monitored daily and highlighted on a large chart - the 'name and shame' board.
'If they do not perform, the bank can have them sacked within three months for non-performance.'
Read more: http://www.dailymail.co.uk/money/article-1250782/B...
Apologies Cameron, this really isnt a dig at you, but the Daily Mail are just cretins and idiots beyond belief when it comes to reporting on Financial Matters. Also the guy above is a part-time adviser - not exactly sterling reference material.Taken from the daily mail today and pretty much says that they hard sell. I'll see how i get on tomorrow but not expecting much.
Barrie Roberts, 58, from Stoke-on-Trent, Staffordshire, has worked as a bank adviser and is now a part-time financial adviser with Positive Solutions, an adviser network.
Barrie, who is married, says banks should be stopped from selling regulated financial products such as risky structured investments - where returns depend on stock markets - and investment funds. Such products have been widely mis-sold by banks, sometimes resulting in heavy fines from the Financial Services Authority.
'Often, customers don't understand the product they are signing up to,' says Barrie. 'To make matters worse, the staff don't understand the products. Then, when the investment plan matures, the bank salesperson has long gone, leaving the customer disenfranchised.'
Barrie says branch staff should not be under pressure to sell products by having a large chunk of their salary dependent on meeting sales targets. This view is shared by some bank branch staff who have contacted us anonymously.
One says: 'As a long-serving employee of an almost nationalised bank, this is going to be the worst year for its treatment of the lowly cashier. They are targeted daily to provide appointments to branch advisers as well as given targets to open new savings accounts. Their performance is monitored daily and highlighted on a large chart - the 'name and shame' board.
'If they do not perform, the bank can have them sacked within three months for non-performance.'
Read more: http://www.dailymail.co.uk/money/article-1250782/B...
Banks do pressure their staff for targets but the compliance requirements are massive and the penalties for mis-advice quite sizeable.
Whenever there is a boom on everyone loves it, complaints go down, people are happy. When a bust is on complaints go up, people are annoyed and reporting becomes disjointed. Everyone needs someone to blame other than themselves.
Hi,
I wwould be very interested in how you got on at the bank.
I'm a financial advisor and i've got a client in a similar situation, and i am helping her to claim all her money back.
All financial professionals have a duty of care to their clients, a fact that seems to be overlooked by the banks and they can sell what they like.
The top and bottom of it is this - even if your m.i.l signed five hundred documents there is still a basis for a mis selling claim under the KYC and TCF guidlines.
I wwould be very interested in how you got on at the bank.
I'm a financial advisor and i've got a client in a similar situation, and i am helping her to claim all her money back.
All financial professionals have a duty of care to their clients, a fact that seems to be overlooked by the banks and they can sell what they like.
The top and bottom of it is this - even if your m.i.l signed five hundred documents there is still a basis for a mis selling claim under the KYC and TCF guidlines.
Hi, we have put a complaint in with the high street bank. They have 8 wks to respond and not expecting a lot of joy so will then take it up with fsa. Mother in law cannot find any documents that she received and signed so will have to see what the bank comes up with. The guy i spoke with at the fsa seemed to think we have a good case and was very helpful.
caterhamboy said:
Hi, we have put a complaint in with the high street bank. They have 8 wks to respond and not expecting a lot of joy so will then take it up with fsa. Mother in law cannot find any documents that she received and signed so will have to see what the bank comes up with. The guy i spoke with at the fsa seemed to think we have a good case and was very helpful.
Request a copy of your file (subject access request) so you can see what documents they claim to have provided to your MiL. It'll probably cost you £10, which is the most they can charge for this. They have to comply with this request.Heathwood said:
Request a copy of your file (subject access request) so you can see what documents they claim to have provided to your MiL. It'll probably cost you £10, which is the most they can charge for this. They have to comply with this request.
Very good strategy. Why not wait for response first? Not just to save the £10. If they have properly investigated this, then technically there should be more information such as any interviews they carry out with people over the client.Gassing Station | Finance | Top of Page | What's New | My Stuff