Not upheld: Motor finance commission (DCA) complaint against Janus Henderson Fund Management UK Limited

Decision detail

Summary

Mr B inherited investments from his father in 1999 that were held with JHI, with Firm B recorded as the adviser. In 2024, Mr B discovered that JHI had been paying trail commission to Firm B since at least 2011 without his knowledge, and he requested a full refund. He also complained about being charged approximately £400 to convert his Class A shares to Class E shares and about service failures including a delayed callback and delayed conversion confirmation. The ombudsman found that the trail commission payments were legitimate under pre-2012 industry practice and were adequately disclosed on statements, and that the share conversion involved no hidden charges as the total value remained identical. However, the ombudsman upheld the complaint in part, finding that JHI's service failures in communication warranted compensation of £100.

The Ombudsman's reasoning

The ombudsman found that trail commission payments were standard practice prior to the Retail Distribution Review in 2012 and were typically payable for the lifetime of investments even after ownership changed, without requiring ongoing advice. The commission was part of bundled charges built into the fund costs and was not separately itemised on statements as required by regulations at the time. Firm B's name appeared on statements from at least 2014, providing sufficient indication of their involvement. The share conversion involved no charge as the total value remained identical; the reduction in unit numbers reflected the higher unit price of Class E shares. However, JHI failed to provide timely confirmation of the conversion and failed to call Mr B back as promised, causing frustration and confusion.

How this compares

Source

Read the original decision on the Financial Ombudsman Service website