Cash Investment Decision Reference 2025-0091

• Case Outcome: Substantially upheld
• Year: 2025
• Reference: 2025-0091
• Date: 18 July 2025
• Subject Matter: Cash Investment
• Finantial Sector: Investment
• Conducts Complained Of: Failure to provide warning re. Nature of investment ,Maladministration

Decision Ref:

2025-0091

Sector:

Investment

Product / Service:

Cash Investment

Conduct(s) complained of:

Failure to provide warning re. Nature of investment

Maladministration

Outcome:

Substantially Upheld

LEGALLY BINDING DECISION OF THE FINANCIAL SERVICES AND PENSIONS OMBUDSMAN

This complaint relates to two bond investments (the “Bonds”).

There are a number of parties referenced in the complaint documents which will also be

referenced in this Preliminary Decision. They are as follows:

• The Provider: The Complainant’s financial advisor, and the respondent in relation

to this complaint

• Company A: The company in which the Bonds were constituted

• Fund Manager B: The Bond provider and promoter

• The Insurance Policy: An insurance policy

• The Insurance Intermediary: The insurance policy broker

• The Insurer: The entity providing insurance cover under the Insurance Policy

The Complainant’s Case

The Complainant sets out that the Provider was his Financial Advisor for a number of years

and based “on [its] advice and on the strength of the information provided in [its)

prospectus [he] invested in two [Company A] Bonds” as follows:

- 2 -

/Cont’d…

1. On 24 July 2018, the Complainant purchased a “12 month Secured Coupon Bond”

(“Bond 1”) to the capital value of €20,000.00 (Twenty Thousand Euro), and;

2. On 15 February 2019, the Complainant purchased a “12 month Secured Coupon

Bond” (“Bond 2”) to the capital value of €40,000.00 (Forty Thousand Euro).

The Complainant submits that the prospectus for the Bonds stated that “the Policy Holder

is Insured/Indemnified through Bond Insurance with Security of Capital” and further stated

that “this policy provides an indemnity in the event of any Actual or Alleged Act, Error,

Misstatement, Misleading Statement, Omission, Neglect or Breach of Duty or Loss.”

The Complainant submits that he had been happy with his investments and expected Bond

1 to reach maturity on 24 July 2019. The Complainant states he grew concerned as he did

not receive his payment in July 2019 as expected and he raised a query with the Provider

on 19 August 2019. The Complainant asserts he did not receive a response and followed

up with a second query on 10 September 2019 to which the Provider replied. The

Complainant states that the Provider issued a response and stated that “we are working

with [Company A] to get a resolution.”

The Complainant submits he raised his concerns again on several occasions, as is

documented in his submissions, and in his email dated 31 October 2019 he stated that he

was “a helpless spectators at a worrying time [and he] would prefer to be kept fully

informed.”

The Complainant submits that an Administrator (the “Administrator”) was appointed to

Company A in October 2019. The Complainant highlights that he remained concerned

about his investments and in communication issued by the Provider, dated 15 December

2019, it stated, “don't worry about this.” The Complainant maintains he was informed by

the Provider on 30 April 2020 that the Provider “relied on the existence of [the] insurance

policy in recommending the [Company A] bond to [the Complainant]; [the Provider] would

not have recommended it if the policy had not been in place.” Furthermore, the

Complainant states that the Provider confirmed that the insurance premium “was not fully

paid” by Company A.

The Complainant explains that there was a break in communication with the Provider,

owing to a bereavement, and he resumed his enquiries in November 2020. The

Complainant submits he received a letter from the Provider, dated 7 December 2020, that

explained to the Complainant that:

“[Company A’s records] show 152 unsecured creditors including bond holders with

estimated non preferential claims totalling c £8.9 million pounds ... there may be

sufficient asset realisations to enable a small dividend to be distributed to