Upheld: Investment mis-selling complaint against Quilter Financial Services Limited
Financial Ombudsman decision DRN-6391786 of 2026-06-25T00:00:00+00:00. Investment mis-selling complaint against Quilter Financial Services Limited. Outcome: Upheld.
Decision detail
| Reference | DRN-6391786 |
|---|---|
| Decision date | 2026-06-25T00:00:00+00:00 |
| Firm | Quilter Financial Services Limited |
| Product | Investment |
| Claim type | Investment mis-selling |
| Outcome | Upheld |
| Remedy | Quilter must compare the performance of each of Miss F's investments (Foresight and Time IHT Plans, and Octopus and Blackfinch ISAs) against the FTSE UK Private Investors Income Total Return Index from the date of investment to the date of the final decision. For each investment, Quilter must calculate the difference between the actual value and the fair value (what it would have been worth using the benchmark return). Compensation must be paid within 28 calendar days of Miss F's acceptance of the decision. If payment is delayed, 8% simple interest per annum applies from the deadline to settlement date. |
Summary
Miss F, in her early eighties with a £2.1 million estate, sought inheritance tax mitigation advice from a new adviser at Quilter in March 2022. The adviser recommended investing approximately £875,000 (over 40% of her estate) in BPR-qualifying assets, primarily AIM shares, requiring her to adopt a much higher risk profile than her established balanced approach. The suitability letter inadequately explained the substantial risks of AIM share investment, and Miss F's quick decision to move the AIM ISAs to cash when they fell in value indicated she had not fully appreciated the risk level at the outset. The ombudsman found the advice unsuitable because it failed to consider alternative blended approaches using trusts, gifts, and insurance that could have achieved her IHT mitigation objectives at a more appropriate and fully understood risk level, and ordered Quilter to compensate Miss F by comparing her investment performance against a diversified benchmark index.
The Ombudsman's reasoning
The ombudsman found that while Miss F did have a significant IHT liability and desire to mitigate it, the recommended strategy was unsuitable because it placed over 40% of her estate at a risk level considerably beyond what she was accustomed to and beyond her confirmed balanced attitude to risk. The suitability letter was not sufficiently emphatic about the risks of AIM share investment, and Miss F's behavior (quickly moving to cash when values fell) demonstrated she had not fully appreciated the level of risk at the outset. The ombudsman noted that alternative approaches using gifts, trusts, and/or whole of life insurance could have achieved the IHT mitigation objective while reducing overall risk to a more suitable and fully understood level. The recommendation was double the maximum proportion usually recommended by the adviser, and there was insufficient consideration of blended approaches.
How this compares
| Group | Decisions | Uphold rate |
|---|---|---|
| Quilter Financial Services Limited, all decisions | 49 | 40% |
| Investment mis-selling, all decisions | 14,163 | 37% |
| Investment, all decisions | 14,180 | 34% |
Source
Read the original decision on the Financial Ombudsman Service website