Partially upheld: ISA / savings administration complaint against Halifax Share Dealing Limited

Decision detail

Summary

Mr B complained that HSDL wrongly transferred his shares in company V out of his stocks and shares ISA without notification or consultation, causing him to incur a tax liability of approximately £4,300. HSDL removed the shares on 12 February 2025 because V had been delisted from HMRC-recognised stock exchanges and was no longer a qualifying ISA investment. The ombudsman found that HSDL acted reasonably in determining the shares were ineligible and in restricting trading due to operational blocks from clearing houses and Russian countersanctions, but found HSDL breached fairness standards by failing to notify Mr B of the removal. The complaint was partially upheld and HSDL was ordered to pay £150 compensation for distress and inconvenience.

The Ombudsman's reasoning

The ombudsman found that HSDL acted reasonably in determining that V shares had become ineligible for ISA holding under HMRC regulations, as the underlying shares were no longer traded on HMRC-recognised exchanges. The decision to restrict trading was also reasonable given operational blocks from clearing houses and custodians. However, HSDL failed to meet the standard of fairness by not notifying Mr B when it removed his shares from the ISA. HMRC guidance requires ISA managers to provide written details when investments are withdrawn, and regardless of technical interpretations of that guidance, fairness required HSDL to inform Mr B of an action taken on his individual account that had significant tax consequences.

How this compares

Source

Read the original decision on the Financial Ombudsman Service website