Not upheld: Service failures generally complaint against Jarvis Investment Management Limited

Decision detail

Summary

Mr H complained that Jarvis Investment Management Limited, the custodian of his share holdings, failed to inform him that it could not transfer his holdings to broker 2 due to FCA restrictions, causing delays. He also complained that Jarvis incorrectly treated him as a new customer, failed to allow him to trade during the interim period, and caused delays in transferring his warrant holdings. The ombudsman found that Jarvis's role was limited to custodian, not broker or advisor, and that it was reasonable to interpret Mr H as a new client under the FCA restrictions. The ombudsman concluded that Jarvis was not obliged to provide earlier warnings, had no duty to allow direct trading, and that warrant transfer delays were fair as they followed a reasonable batching system. The complaint was not upheld.

The Ombudsman's reasoning

The ombudsman found that Jarvis's role was limited to custodian, not broker or advisor. The transfer process was initiated and progressed by the new broker, not Jarvis. Mr H's selection on the form was not a direct instruction to Jarvis but rather an indication that the new broker would liaise with Jarvis. It was reasonable for Jarvis to interpret Mr H as a new client under the FCA restrictions because broker 2 would need to open a new account for him. Jarvis was not required to warn Mr H earlier because it was unclear from initial communications whether Mr H intended to keep Jarvis as custodian, and broker 2 should have been aware of the publicly available restrictions. The warrant transfer delays were not unreasonable as they followed a fair batching system processing applications in order received, and the third-party re-registration process was outside Jarvis's control. Jarvis had no obligation to allow direct trading as this fell within the broker's remit, and past discretionary allowance did not create a contractual duty.

How this compares

Source

Read the original decision on the Financial Ombudsman Service website