Upheld: Investment mis-selling complaint against St. James's Place Wealth Management Plc
Financial Ombudsman decision DRN-5941198 of 2026-06-22T00:00:00+00:00. Investment mis-selling complaint against St. James's Place Wealth Management Plc. Outcome: Upheld.
Decision detail
| Reference | DRN-5941198 |
|---|---|
| Decision date | 2026-06-22T00:00:00+00:00 |
| Firm | St. James's Place Wealth Management Plc |
| Product | Investment |
| Claim type | Investment mis-selling |
| Outcome | Upheld |
| Remedy | SJP must: (1) Compare performance of EIS investments to FTSE UK Private Investors Income Total Return Index from date of investment to date of final decision; (2) Pay difference between fair value (benchmark performance) and actual value if fair value is higher; (3) Add interest as applicable; (4) Pay £350 for distress caused by unsuitable investments and lack of timely response; (5) If illiquid assets remain, pay upfront lump sum equivalent to five years' wrapper fees or take ownership of illiquid assets; (6) Pay compensation within 28 calendar days; (7) Pay 8% simple interest per year if payment deadline missed. |
Summary
Mrs C received advice from SJP in December 2016 to invest £88,715 in EIS portfolios for CGT mitigation following a business sale. By 2024, one scheme had lost practically all value. Mrs C complained that the investments were unsuitable, too high risk, and illiquid, and claimed she had to take a mortgage in 2023 because capital was tied up. The ombudsman upheld the unsuitable advice complaint, ordering benchmark comparison redress and £350 distress payment, but rejected mortgage-related claims as Mrs C had not disclosed property purchase plans in 2016 and seven years had elapsed between advice and mortgage.
The Ombudsman's reasoning
The ombudsman found the EIS investments were unsuitable because they were too high risk for Mrs C's circumstances and objectives. Mrs C would likely have paid the £9,000 CGT liability instead. The ombudsman rejected the mortgage claim because: (1) no property purchase was mentioned in the 2016 fact find; (2) Mrs C had substantial liquid assets; (3) seven years elapsed between advice and mortgage; and (4) it was Mrs C's own life decision in 2023 when she was aware of her financial circumstances. The benchmark comparison to FTSE UK Private Investors Income Index is appropriate as it reflects a diversified, moderate-risk portfolio suitable for someone willing to accept some investment risk.
How this compares
| Group | Decisions | Uphold rate |
|---|---|---|
| St. James's Place Wealth Management Plc, all decisions | 688 | 26% |
| Investment mis-selling, all decisions | 14,163 | 37% |
| Investment, all decisions | 14,180 | 34% |
Source
Read the original decision on the Financial Ombudsman Service website