Partially upheld: Investment mis-selling complaint against CARNWYLLON WEALTH MANAGEMENT LIMITED
Financial Ombudsman decision DRN-5938864 of 2025-12-12T00:00:00+00:00. Investment mis-selling complaint against CARNWYLLON WEALTH MANAGEMENT LIMITED. Outcome: Partially upheld.
Decision detail
| Reference | DRN-5938864 |
|---|---|
| Decision date | 2025-12-12T00:00:00+00:00 |
| Firm | CARNWYLLON WEALTH MANAGEMENT LIMITED |
| Product | Investment |
| Claim type | Investment mis-selling |
| Outcome | Partially upheld |
| Remedy | Carnwyllon must pay compensation to the estate of Mrs M by comparing actual investment performance against benchmarks: For 2013 bond: compare against FTSE UK Private Investors Income Total Return Index from date of investment to date ceased, paying difference if fair value exceeds actual value, plus 8% simple interest per year on any loss from end date to settlement. For 2017 bond: compare against 50% FTSE UK Private Investors Income Total Return Index and 50% average fixed-rate bond rates from Bank of England, paying difference if fair value exceeds actual value, plus 8% simple interest per year on any loss. Compensation must be paid within 28 calendar days of estate's acceptance of decision. If not paid by deadline, 8% simple interest applies from deadline to settlement date. Actual value to be calculated net of any chargeable gains tax paid. |
Summary
Mrs M, represented by a claims management company, complained that Carnwyllon Wealth Management provided unsuitable investment advice when recommending offshore and onshore investment bonds in 2013 and 2017, and failed to provide an ongoing advice service for which she was charged. Mrs M was in her 80s at both times and already held a successful investment bond from 2006. The ombudsman upheld the complaint regarding both investment recommendations, finding them unsuitable given her age, need for accessible funds, concerns about care costs, and actual risk tolerance, though the ongoing advice complaint was not upheld as reviews post-2018 were carried out. Carnwyllon was directed to pay compensation calculated by comparing actual bond performance against appropriate benchmarks, with 8% simple interest on any losses.
The Ombudsman's reasoning
The ombudsman found that Mrs M's age (80s) required careful consideration of her circumstances and flexibility needs regarding access to money. The 2013 advice was unsuitable because: (1) the 89% equity allocation was inconsistent with her 'lowest medium' risk profile and her actual answers to risk questionnaire; (2) recommending another offshore bond restricted tax-efficient withdrawal options; (3) early withdrawal charges applied for five years with no additional life assured added; (4) insufficient time was given to consider the recommendation. The 2017 advice was also unsuitable because: (1) despite lower risk being more appropriate, the fact find showed Mrs M was concerned about accessing funds for care costs, which the bond recommendation limited; (2) more suitable alternatives like adding to her existing ISA were not considered; (3) the bond was more expensive than alternatives; (4) insufficient time was allowed for consideration given her age and health status. The ombudsman rejected Carnwyllon's arguments that bonds might be discounted for care fees and that she had sufficient cash to contribute to ISA separately, finding these did not address the core suitability issues.
How this compares
| Group | Decisions | Uphold rate |
|---|---|---|
| CARNWYLLON WEALTH MANAGEMENT LIMITED, all decisions | 2 | 75% |
| Investment mis-selling, all decisions | 14,206 | 37% |
| Investment, all decisions | 14,114 | 34% |
Source
Read the original decision on the Financial Ombudsman Service website