Cash Investment Decision Reference 2023-0032

• Case Outcome: Substantially upheld
• Year: 2023
• Date: 21 February 2023
• Reference: 2023-0032
• Subject Matter: Cash Investment
• Finantial Sector: Investment
• Conducts Complained Of: Mis-selling (investment),Alleged poor management of fund, Complaint handling (Consumer Protection Code) , Delayed or inadequate communication, Fees & charges applied , Maladministration

Decision Ref:

2023-0032

Sector:

Investment

Product / Service:

Cash Investment

Conduct(s) complained of:

Mis-selling (investment)

Delayed or inadequate communication

Complaint handling (Consumer Protection Code)

Fees & charges applied

Maladministration

Alleged poor management of fund

Outcome:

Substantially upheld

LEGALLY BINDING DECISION OF THE FINANCIAL SERVICES AND PENSIONS OMBUDSMAN

This complaint arises from an investment of £140,000 in an Asset Management Policy (the

“Policy”) which the Complainants purchased in August 2013. The Policy itself was supplied

by a life insurance provider (“the Insurer”).

In 2013, when the Complainants purchased the Policy, the entity which they dealt with and

which arranged the investment Policy for them, was based in Spain and operated under a

certain brand name. The Provider states that this entity was a brand name and an agent of

an insurance intermediary based in another EU member state. This entity and the insurance

intermediary are referred to collectively in this decision, as the First Intermediary.

The documentation on file indicates that the Complainants became clients of the First

Intermediary when they purchased the Policy in 2013.

The Complainants’ client account appears to have been subsequently transferred from the

First Intermediary to a named Second Intermediary, also based in a different EU member

state, and ultimately in 2016, the Complainants’ client account was transferred to the

Provider, which is regulated by the Central Bank of Ireland.

In March 2015, the Complainants withdrew £55,000 from the Policy, and in January 2019,

the Complainants encashed the balance of their Policy, at a value of £84,235.95.

- 2 -

/Cont’d…

The Complainants’ Case

The Complainants submit the Provider agreed to supply them with quarterly reviews of the

Policy from its inception. The Complainants have supplied a copy of a Client Confirmation

Form which they signed in 2013, in or around the time they purchased the Policy, on which

they selected an option for quarterly updates from their advisor.

The Complainants state that while initially this was adhered to, from late 2017, “it started

to go catastrophically awry”. The Complainants state that they did not receive a quarterly

review in the period from 1 November 2017 to January 2019, except for a review carried

out on 9th April 2018. They say that:

“[o]ur next quarterly review would be due in July 2018. We had contact in July from

[the Provider] to arrange a quarterly review on 2nd August 2018. However, that

appointment was never kept by [the Provider]. After waiting two months for contact

from [the Provider] I sent an email to [the Provider] point out the lack of contact and

indicating that I was about to take action”.

The Complainants also submit that they did not receive the full value of their Policy, when

they encashed it in January 2019. They state that they were informed by the Provider in an

email dated 17th December 2018 that they would secure the price of the fund on the day

their encashment instruction was placed. The Complainants submit that their encashment

instruction was placed by the Provider on 20th December 2018, as evidenced by an email

from the Provider to the Complainant dated 20th December 2018, which states:

“Instruction received and placed. I will give you a call at 10am tomorrow to discuss”.

The Complainants say that the value of the fund was £88,434,36 on 20 December 2018.

The Complainants state that they received £84,235,95 on 8 January 2019, leaving a shortfall

of £1,552,41 after the encashment penalty of £2,646 was accounted for. They contend that:

“[c]learly the instruction had not been placed when [the Provider] said it had been

placed”

The Provider’s Case

The Provider submits that it engaged in a high level of communication with the

Complainants, including policy reviews. It asserts that only one review was missed since the

transfer of the policy to the Provider in 2016, and that endeavours were made to complete

this review. It also notes that it issued “an apology that it was not followed up”.

The Provider disputes the assertion that it failed to carry out quarterly reviews, with the

exception of the review carried out in August 2018, which the Provider states was

rescheduled to October 2018. It refers to telephone records detailing calls that took place

between the parties, in the relevant period of November 2017 to January 2019.