Not upheld: unsuitable investment advice complaint against St. James's Place Wealth Management Plc

Decision detail

Summary

Ms G complained that SJP provided unsuitable investment advice in November 2020 when she received £300,000 from a property sale. She argued that SJP should have recommended using the funds to cover her liabilities (mortgages, taxes, living expenses) rather than investing in speculative products with substantial fees. The ombudsman found that Ms G had sufficient income to cover her expenses, retained adequate cash reserves of £60,000, and that her mortgage repayments were comfortably met from rental income. The recommended investments (IIB, UTF, and ISA) were aligned with her stated objectives of capital growth and tax efficiency, and were appropriate for her medium risk attitude. The ombudsman rejected the argument that funds should have been used to pay off mortgage debt, noting that Ms G's priority was investment for growth. The complaint was not upheld.

The Ombudsman's reasoning

The ombudsman found that SJP had sufficient information about Ms G's financial situation and that the advice was suitable. Ms G had sufficient income to cover her expenses and mortgage repayments, and retained adequate cash reserves (£60,000) after investing £300,000. The recommended investments aligned with her stated objectives of capital growth and tax efficiency, and were broadly in line with her medium risk attitude. Ms G's overall investment portfolio (4% high risk, 83% medium risk, 13% no risk) was appropriate given her circumstances and capacity to take risk. The ombudsman rejected the argument that funds should have been used to pay off mortgage debt, noting that Ms G's priority was investment for growth and tax efficiency, and that many investors prefer to invest rather than repay low-cost debt. The mother's death did not warrant a reassessment of the advice.

How this compares

Source

Read the original decision on the Financial Ombudsman Service website