Not upheld: Investment mis-selling complaint against Brown Shipley & Co Limited

Decision detail

Summary

Mr and Mrs S invested £100,000 each with Brown Shipley in 2018 following an inheritance. Both portfolios fell below the initial investment amounts, and Mr S suffered a severe mental health breakdown attributed to anxiety about fluctuating portfolio values, requiring medical intervention and medication. Mr S claimed Brown Shipley failed to recognise his vulnerability despite multiple emails expressing anxiety, failed to honour an alleged commitment to disinvest if portfolios fell below £100,000 each, and failed to clearly explain that moving to cash was a simple option. The ombudsman found that Brown Shipley's adviser did recognise Mr S's vulnerability and provided appropriate responses, including explicitly stating that wellbeing should take priority over financial returns. The ombudsman rejected the claim of a binding disinvestment commitment and found that Brown Shipley adequately explained available options. The complaint was not upheld and no compensation was awarded.

The Ombudsman's reasoning

The ombudsman found that while Mr S clearly experienced significant anxiety about the investments, Brown Shipley's adviser recognised this anxiety and provided appropriate responses. The business did not commit to a guaranteed disinvestment at £100,000 per portfolio, despite Mr S's December 2021 email; instead, the adviser emphasised that Mr S's wellbeing should take priority and that disinvestment was an option available to them. Brown Shipley adequately explained its restricted status and the availability of cash options. The adviser's responses to Mr S's concerns were reasonable and reflected appropriate care for his vulnerability, particularly in September-October 2022 when the adviser explicitly stated that if market events were impacting Mr S's health, the benefit of waiting was outweighed by the need to focus on wellbeing. The ombudsman concluded that no definitive agreement existed to disinvest at a particular valuation, and that Brown Shipley did not misrepresent the complexity of moving to cash.

How this compares

Source

Read the original decision on the Financial Ombudsman Service website