Upheld: irresponsible advice and failure to ensure informed consent - vulnerable customer complaint against St. James's Place Wealth Management Plc
Financial Ombudsman decision DRN-6259889 of 2026-05-20T00:00:00+00:00. irresponsible advice and failure to ensure informed consent - vulnerable customer complaint against St. James's Place Wealth Management Plc. Outcome: Upheld.
Decision detail
| Reference | DRN-6259889 |
|---|---|
| Decision date | 2026-05-20T00:00:00+00:00 |
| Firm | St. James's Place Wealth Management Plc |
| Product | investment and wealth management - discretionary discounted gift trust (DDGT) |
| Claim type | irresponsible advice and failure to ensure informed consent - vulnerable customer |
| Outcome | Upheld |
| Remedy | SJP must: (1) arrange for the DDGT to be unwound if possible and return the funds to Mrs D; (2) if unwinding is not possible, discuss with Mrs D and trustees how to adjust the arrangement so Mrs D is not financially disadvantaged; (3) cover all associated costs incurred in setting up and unwinding/resolving the arrangement; (4) provide an indemnity against reasonably foreseeable future liabilities arising from creation or unwinding of the trust; (5) pay Mrs D £400 for distress and inconvenience. Returned funds to include capital and investment growth less any payments already received. SJP is not required to reimburse representative fees incurred by Mr H. |
Summary
Mrs D, a legally blind client of SJP for several years, received advice in December 2023 to invest £300,000 into a discretionary discounted gift trust (DDGT) following the sale of a property. Mrs D believed the money was being invested in conventional products such as unit trusts and investment bonds, similar to her previous investments. The DDGT was established following electronic documentation and signature, with SJP relying on verbal discussions, the presence of Mrs D's husband, and her previous investment experience. In early 2025, when the trust arrangement came to light, Mrs D complained that she had not understood a trust was being established. SJP rejected the complaint, but the ombudsman upheld it, finding that SJP failed to take reasonable additional steps to ensure Mrs D, as a legally blind client, could access, understand and give informed consent to the materially different DDGT arrangement before it was established. The ombudsman ordered SJP to unwind the trust, return the funds, cover associated costs, provide an indemnity, and pay £400 compensation.
The Ombudsman's reasoning
The ombudsman found that SJP failed to take reasonable additional steps to ensure Mrs D, a legally blind client, could access, understand and give informed consent to the DDGT before it was established. Although SJP conducted verbal discussions, sent electronic documentation, and obtained an electronic signature, these steps were insufficient given the material difference between a DDGT and Mrs D's previous conventional investments, and given SJP's knowledge of her visual impairment. The ombudsman rejected SJP's reliance on the husband's attendance at meetings, noting that the obligation to ensure understanding remained with SJP as Mrs D's adviser. The ombudsman found Mrs D's consistent explanation that she believed the money was being invested in unit trusts or investment bonds to be persuasive evidence that she did not genuinely understand the trust arrangement. Had SJP taken reasonable steps to ensure understanding, the ombudsman concluded it was more likely Mrs D would not have proceeded.
How this compares
| Group | Decisions | Uphold rate |
|---|---|---|
| St. James's Place Wealth Management Plc, all decisions | 682 | 26% |
Source
Read the original decision on the Financial Ombudsman Service website