Not upheld: unsuitable investment advice; inadequate consideration of mortgage liabilities; inadequate vulnerability assessment complaint against Perspective (South West) Limited

Decision detail

Summary

Ms S complained about investment advice provided by Perspective following her husband's death in 2020. She felt insufficient regard was given to her mortgage liabilities, her risk assessment was incorrect, and her vulnerabilities were not properly considered. Perspective recommended transferring her ISA and SIPP to a new platform with a revised asset allocation based on her assessed 'top moderate' risk profile. The ombudsman found the advice was suitable, the risk assessment reasonable, the mortgage strategy appropriate given preferential interest rates (0.1%-2.39%), and vulnerability properly addressed. However, Perspective acknowledged failing to implement some 2023 recommendations and offered a £4,329 fee refund, which the ombudsman found fair and reasonable.

The Ombudsman's reasoning

The ombudsman found the risk assessment reasonable given Ms S's answers and circumstances, with her attitude to risk representing a mid-range, balanced approach. The recommendation was suitable and consistent with agreed objectives. Regarding mortgages, keeping money invested while servicing low-interest liabilities (0.1%-2.39%) was not unreasonable, particularly as Ms S had plans to reduce balances using inheritances, which she subsequently did. Poor investment performance must be viewed in context: only 2 years into a 10-20 year term, 2022 was exceptionally challenging for markets, and hindsight shows alternative strategies might have performed better but this cannot be used to fault the original advice. Perspective demonstrated appropriate vulnerability awareness through its processes and support arrangements.

How this compares

Source

Read the original decision on the Financial Ombudsman Service website