Not upheld: alleged unsuitable investment advice - market timing recommendation complaint against St James's Place Wealth Management Plc

Decision detail

Summary

Mr W complained that SJP advised him in December 2012 to switch his pension investments from equity-based funds to a money market fund in anticipation of a financial downturn that never materialised, causing him to miss out on market growth. SJP denied giving such advice. The ombudsman examined evidence including file notes, the absence of written advice documentation, and a recorded phone call Mr W made with the retired adviser. Finding no clear evidence of regulated advice being given, and noting Mr W's established pattern of independently making market-timing investment decisions, the ombudsman did not uphold the complaint. The ombudsman was also influenced by Mr W's 10+ year delay in raising the complaint.

The Ombudsman's reasoning

The ombudsman applied the balance of probabilities test and found that the totality of evidence did not support that SJP gave regulated advice to switch funds in December 2012. Key reasoning included: (1) absence of written documentation (suitability letter or file note) that would typically evidence regulated advice; (2) a clear pattern of Mr W making his own investment decisions to time the market both before and after December 2012, making the transaction consistent with his established behaviour rather than unusual; (3) the March 2013 file note recording Mr W as 'slightly nervous' about markets with no reference to prior adviser-recommended switching, suggesting Mr W was driving decisions; (4) the phone call recording with the adviser showed only vague recollection and did not constitute a clear admission of advice-giving; (5) the manner in which Mr W posed questions in the recorded call was leading and the adviser's responses were ambiguous; (6) the 10+ year delay in raising the complaint undermined credibility, as Mr W would have known of the loss in 2013 when the expected downturn did not materialise.

How this compares

Source

Read the original decision on the Financial Ombudsman Service website