Not upheld: Inadequate warnings regarding ISA withdrawal consequences and loss of ISA allowance complaint against HSBC UK Bank Plc

Decision detail

Summary

Mr G complained that HSBC's platform errors caused him to lose his ISA allowance for the tax year. On 14 June 2025, after transferring £19,544.80 to his ISA uninvested cash account, the system showed only £455.30 remaining allowance. Unable to reach the investment team, Mr G withdrew the £20,000 to his savings account, which resulted in losing his ISA allowance for the year. HSBC's final response letter incorrectly stated that pop-up warnings existed, though they later confirmed no such warnings were in place. The ombudsman found that HSBC had adequately disclosed ISA withdrawal consequences through the Key Features Document, quarterly statements, and website, and that Mr G's withdrawal was his own decision rather than HSBC's instruction. The complaint was not upheld, and no compensation was ordered.

The Ombudsman's reasoning

The ombudsman found that while HSBC's portal did not provide a real-time warning before the withdrawal, adequate information about ISA withdrawal consequences was clearly articulated in the Key Features Document, quarterly statements, and website. The ombudsman noted that FCA rules require clear and comprehensible information about product consequences, not necessarily real-time digital warnings. The withdrawal was initiated by Mr G in response to a system message, not on HSBC's instruction or suggestion. Although HSBC provided misleading information in their final response letter about pop-up warnings, this occurred after the withdrawal and did not influence Mr G's original decision. The ombudsman considered that someone working in banking should reasonably understand ISA withdrawal implications, and that financial products require both proper disclosure by the firm and responsible decision-making by the consumer.

How this compares

Source

Read the original decision on the Financial Ombudsman Service website