Not upheld: General financial advice complaint against James Brearley & Sons Limited

Decision detail

Summary

Mr and Mrs F complained that James Brearley & Sons Limited mis-sold them an investment bond in 1997, charged excessive fees, and failed to provide adequate ongoing advice. They invested £50,000 of pension funds into an offshore investment bond and paid a 6.25% up-front fee (£3,125). Upon cashing in the investment in 2004 for £41,558.52, they discovered the fee had been deducted from their investment and believed their investment underperformed as a result. The ombudsman found the low-risk investment bond was suitable for their risk profile, the fee was reasonable and within market range for IFA services, and Brearley's provided sufficient ongoing advice through periodic contact and reviews. The complaint was not upheld.

The Ombudsman's reasoning

The ombudsman found that the investment bond was low risk and suitable for Mr and Mrs F's stated objectives and risk appetite. The Key Features document clearly stated that growth was not guaranteed, so Mr and Mrs F should have been aware of this. The fee of 6.25% was reasonable and within market range for IFA services, and while the wording in the Key Features document could have been clearer about who paid the fee, Mr and Mrs F were always likely to incur a fee for professional investment advice. Brearley's provided ongoing advice at various points including a 2000 questionnaire review and prompt notification of the 2004 asset mix change. Without a specific agreement about the format of ongoing advice, the firm was not obliged to provide more than it did.

How this compares

Source

Read the original decision on the Financial Ombudsman Service website