Upheld: Service failures generally complaint against Embark Investment Services Limited

Decision detail

Summary

Mr W complained that Stocktrade failed to inform him that his appropriateness form for purchasing shares within his SIPP had been approved, causing a 14-month delay between February 2023 and April 2024. Stocktrade actioned the form on 21 February 2023 but did not communicate this to Mr W, who only discovered the approval when he queried the matter in April 2024. The ombudsman upheld the complaint and ordered Stocktrade to compensate Mr W for the difference between the share price he could have paid on 21 February 2023 and the price he actually paid on 5 April 2024, plus £200 for distress and inconvenience. The ombudsman rejected Mr W's request for additional interest, finding that the share price difference alone fairly compensates for the delay.

The Ombudsman's reasoning

The ombudsman found that Stocktrade failed to communicate the approval of the appropriateness form, which prevented Mr W from purchasing shares when he was ready to do so in February 2023. The ombudsman accepted that had Stocktrade informed Mr W of the approval on 21 February 2023, he would have purchased the shares at that time rather than 14 months later in April 2024. The share price difference between these two dates represents the calculable loss. The ombudsman rejected Mr W's request for additional interest, reasoning that while he lost interest on the overpayment amount, he also gained interest on the full investment amount that would have been deducted in February 2023, making the net position uncertain and the share price difference alone a fair remedy. The £200 distress award was upheld as reasonable given that Mr W was unaware of the issue during the 14-month delay and the loss was limited to a pension account not affecting day-to-day finances.

How this compares

Source

Read the original decision on the Financial Ombudsman Service website