What are Savings & Investments?
When relating to finance, these give a return for monies invested at a set or variable rate for an agreed period of time with the expectation of capital appreciation. There are a variety of savings and investment products available to consumers. Given the number of products and the choice of funds, many consumers seek advice from trusted organisations, banks, building societies, or an Independent Financial Advisor (IFA).
A sales advisor should take into account:
- Any existing investments the consumer has, their experience and financial circumstances
- Consumer’s attitude to risk and capacity to bear loss
- Consumer’s long-term aims regarding the investments
- Consumer’s unique circumstances including their age and occupation
- The features of the investment including its complexity and the underlying level of risk
- The information investors receive should be ‘clear, fair and not misleading’ often this was not done.
- The advice was not suitable and did not take into account consumers’ needs and circumstances.
The Financial Ombudsman Service (FOS) has issued technical guidance on how it assesses complaints about the suitability of investment advice.
- They take into account the regulatory and legal standards that apply at the time the advice was given.
- Redress is aimed at putting the consumer back into the position he would have been in had he not received the poor advice.
- Compensation could be a return of investment monies plus interest, or a return worked out using a more suitable investment.
Helpful links
Assessing the suitability of investments
Provided by the FOS (Financial Ombudsman Service)
