Leading financial claims expert Michelle Barrett has highlighted her concerns that the mis-selling of investment products by the high st banks is being overlooked during the continuing furore over mis sold PPI.
"We are dealing with increasing volumes of bank customers who have been let down by poor financial advice. It affects many thousands of people who have invested their savings on the advice of their banks and lost money" said Michelle Barrett of Credit Claims in Bolton. The mass mis-selling of Payment Protection Insurance (PPI) is already firmly in the public domain and many consumers have now reclaimed thousands of pounds. A recent report by the Financial Ombudsman Service says it is getting around 1500 complaints every day and the banks have now set aside over £10 billion to repay customers who have been affected. It appears the same cannot be said about mis sold investments.
"We hear stories of customers being pestered into meeting with a financial adviser at the bank when the bank notice that they have a certain amount of savings. The commission driven salesman will persuade the customer to often invest a large percentage of their savings into a stock market linked product, without properly explaining the risks involved" said Michelle Barrett
Many of the banks have already been hit with big fines by the Financial Services Authority. In January 2011 Barclays was fined £7.7 million for failing to ensure the funds it recommended were suitable for customers taking into account their investment objectives, financial situation and investment knowledge. In December last year HSBC was hit with a £10.5 million penalty for poor advice to elderly people in care. That fine came a month after private bank Coutts was fined £6.3m and the UK arm of Credit Suisse £5.95 for similar failings.
One example of how customers were misled was 69 year old William Thornley from Bolton. He says "I explained to the adviser that we definitely didn`t want to gamble this money at it was very important to us, being from my mothers estate and meant to secure our future" After investing £50,000 he was horrified to discover that just 2 years into the plan his fund had dropped by over £16,000 "We just couldn`t believe it and not being able to get hold of the adviser we cashed it in as we couldn`t afford to lose any more. We were extremely upset"
Michelle Barrett says "This is typical of the elderly people targeted by the banks with promises of better returns. In this case we were able to secure Mr Thornley a refund of nearly £22,000 but many people just think they have to accept the loss. That is not the case and we need to educate the general public that they can do something about bad advice. Take your complaint up with the bank and if you don`t get the response you are looking for you should refer it to the Financial Ombudsman Service for an independent review"
