Not upheld: Section 75 claim handling - investment services and artwork purchases complaint against Lloyds Bank Plc

Decision detail

Summary

Mr N complained that Lloyds unfairly declined his Section 75 claim relating to payments made to investment services supplier G for a £25,000 fixed return investment arrangement and artwork purchases totalling approximately £49,700. Lloyds declined the claim on technical grounds and lack of evidence of breach or loss. The ombudsman found that while a debtor-creditor-supplier agreement was likely in place, Mr N failed to prove a breach of contract or misrepresentation causing financial loss. The investment agreement did not guarantee capital repayment, the £5,000 artwork was sold at a profit, and the £40,000 artwork purchase exceeded S75 limits without individual item pricing. The complaint was not upheld.

The Ombudsman's reasoning

The ombudsman found that while a debtor-creditor-supplier agreement was likely in place, Mr N failed to establish a breach of contract or misrepresentation causing financial loss. The investment agreement, read as a whole, did not constitute a clear and unconditional promise of capital repayment or guaranteed returns. The lack of information about what happened to the invested funds did not establish that a loss had occurred. For the £5,000 artwork, no loss was evident as it was sold for more than purchased. For the £40,000 artwork purchase, the combined price exceeded the S75 limit and no individual item pricing was documented.

How this compares

Source

Read the original decision on the Financial Ombudsman Service website