Upheld: investment advice - misinformation regarding tax relief certificate timing complaint against St James's Place Wealth Management Plc

Decision detail

Summary

Mr and Mrs N complained to the FOS about investment advice from SJP regarding £100,000 each into enterprise investment schemes. They claimed they were promised tax relief certificates by November 2024 for the 2023/24 tax year, but certificates did not arrive until after January 2025, forcing them to pay tax and abandon plans for a larger commercial property purchase. The ombudsman found that while SJP initially misinformed them on 6 March 2024, this was corrected in the client declaration signed on 22 March 2024 before the investment decision. The ombudsman upheld the complaint in part, finding SJP liable for £500 compensation for distress and loss of expectation, but not for the failed property transaction or loan costs, as Mr and Mrs N were correctly informed about the tax certificate timeline before committing to invest.

The Ombudsman's reasoning

The ombudsman found that while SJP initially misinformed Mr and Mrs N on 6 March 2024, this was corrected in the prominent and clearly written client declaration signed on 22 March 2024 before the investment decision. The 25 March email response was ambiguous but occurred after the investment commitment. Mr and Mrs N were responsible for understanding the documents they signed, particularly given the high-risk nature of EIS investments. Although Mr and Mrs N suffered loss of expectation regarding their property purchase plans, SJP is not liable for the failed transaction itself since the clients were correctly informed about the tax certificate timeline. SJP's liability is limited to compensation for distress and inconvenience caused by the misinformation.

How this compares

Source

Read the original decision on the Financial Ombudsman Service website