Not upheld: charges disclosure and alleged agreement regarding waiver of initial advice fees complaint against St. James's Place Wealth Management Plc

Decision detail

Summary

Mr and Mrs R complained that an SJP adviser led them to believe that charges for investment advice on a £2,000,000 investment would be waived, with payment instead through ongoing 0.5% annual charges. In 2025, they discovered a 4.5% initial advice charge had been applied to investment bonds. SJP explained that the initial charge was waived only for unit trusts (£290,000), while bonds had a different charging structure with no upfront charge. The ombudsman found that product illustrations clearly disclosed the 4.4% initial advice charge for bonds and that no documentary evidence supported an agreement to provide all advice free of charge. The complaint was not upheld.

The Ombudsman's reasoning

The ombudsman found that what was actually agreed was a charging structure with no upfront costs, achieved by waiving the unit trust initial charge but not the bonds (which had no upfront charge structure). The product illustrations clearly disclosed the 4.5% initial advice charge for bonds, distinguishing them from unit trusts. While Mr R may have reasonably concluded that ongoing advice charges were the sole payment mechanism, the illustrations contradicted this understanding. The ombudsman found it unlikely that advice on a £2,000,000 investment would be provided entirely free, and noted that ongoing charges were separate and distinct, paying for ongoing services rather than initial advice.

How this compares

Source

Read the original decision on the Financial Ombudsman Service website