Not upheld: Account closure without notice complaint against Saxo Capital Markets UK Ltd

Decision detail

Summary

S complained that Saxo unlawfully sold shares in its dealing account without consent or authorisation and closed the account. Saxo had initiated an ODD/KYC process in July 2022 and, after months of correspondence and repeated information requests, notified S in November 2023 that the account would close on 24 January 2024 if required information was not provided. Following further exchanges, Saxo sold the shares on 24 April 2024 as part of account closure, which S discovered on 3 May 2024. The ombudsman found that Saxo acted fairly in terminating the account and selling the shares as a contractual consequence, as it had provided clear notice and S was non-compliant with regulatory KYC requirements. Although communication could have been clearer, the ombudsman found no material loss to S and upheld Saxo's offer of £250 compensation for inconvenience.

The Ombudsman's reasoning

The ombudsman found that Saxo was entitled to terminate the account under its terms and conditions due to S's non-compliance with KYC/ODD requirements. The November 2023 email provided clear notice of the intention to close the account and the consequence that shares would be sold. Although Saxo's communication could have been clearer regarding extensions and the final decision to close, this did not cause S to lose out because S would not have transferred the shares to another broker due to cost and inconvenience concerns. The sale of shares was a contractual consequence of account termination, not an unauthorised transaction. The ombudsman acknowledged regulatory obligations but found the circumstances specific to the ODD process justified the account closure and asset disposal.

How this compares

Source

Read the original decision on the Financial Ombudsman Service website