Not upheld: Irresponsible lending complaint against Hargreaves Lansdown Asset Management Limited (trading as Hargreaves Lansdown)

Decision detail

Summary

Mr C opened an execution-only Fund and Share Account with HL in December 2021 and suffered £110,000 in losses, primarily through 787 trades in 2021. He complained in September 2025 that HL failed to identify his vulnerability and implement safeguards to prevent losses, claiming HL had regulatory obligations to help him make effective investment decisions. HL responded that the account was execution-only, Mr C had not disclosed vulnerability, and his trading pattern did not trigger intervention. The ombudsman found HL acted fairly and reasonably, noting that Mr C did not disclose vulnerability until his complaint, his 2021 support requests related to trading mechanics rather than vulnerability, and HL appropriately evolved its monitoring after Consumer Duty came into force in 2023. The complaint was not upheld and no compensation was ordered.

The Ombudsman's reasoning

The ombudsman applied the regulatory framework applicable at different periods. Prior to February 2021, firms relied on customer self-disclosure of vulnerability. When FG21/1 was introduced, firms were expected to recognise vulnerability indicators. Consumer Duty (July 2023) required proactive identification but does not require firms to assume vulnerability without clear indicators or verify all financial circumstances in execution-only contexts. Mr C's trading requests in 2021 related to mechanics, not vulnerability. Losses alone are not indicators of vulnerability in stock market trading. HL appropriately evolved its monitoring and proactively contacted Mr C after Consumer Duty came into force, but he did not respond. The account was execution-only with clear risk warnings, and Mr C made his own investment decisions.

How this compares

Source

Read the original decision on the Financial Ombudsman Service website