Not upheld: Investment mis-selling complaint against Interactive Brokers (U.K.) Limited

Decision detail

Summary

Mr K complained that Interactive Brokers unreasonably liquidated three non-qualifying investments from his ISA without his consent, causing him to miss a £25,000 market gain while his funds were out of the market. Interactive Brokers had notified him by email on 16 April 2025 of the regulatory issue and given him until 30 April to take action, but Mr K did not read the email and only discovered the liquidation on 12 May. Mr K argued that Interactive Brokers should have transferred the investments to his GIA instead of liquidating them, citing the terms which permitted both options, and that a single email was inadequate communication for such a significant action. The ombudsman found that email notification was reasonable under the agreed terms, that Interactive Brokers had no duty to track email receipt, and that liquidation was a reasonable default option given the regulatory consequences of leaving non-qualifying investments in an ISA. The complaint was not upheld.

The Ombudsman's reasoning

The ombudsman found that email notification was a reasonable and sufficient communication method as agreed in the terms, and Interactive Brokers had no duty to track whether the email was read. The two-week deadline was not unreasonable, and even if extended, would not have made a difference as Mr K did not read the email until 12 May. While the terms allowed for transfer as an alternative to liquidation, the ombudsman considered liquidation to be the safer and more reasonable default option given the consequences of leaving £400,000 outside ISA status. The ombudsman noted that had Mr K read the email, he could have made his own decision about transferring the investments to his GIA. The account being execution-only meant Interactive Brokers should not second-guess Mr K's investment intentions. The ombudsman was satisfied that Interactive Brokers' actions complied with applicable regulations and principles.

How this compares

Source

Read the original decision on the Financial Ombudsman Service website