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UK adviser forced to compensate despite giving suitable advice

A UK financial advice firm has been ordered to pay £100 in compensation, despite the Financial Ombudsman Service determining the advice to be appropriate.

According to the FOS report, a client known referred to as Ms M had complained about advice she received from David Stock & Company regarding her pension plans and investments.

Ms M did not believe she should have been advised to take her pension in 2011, as she was still working and had to pay tax on her income, the report said. The client had also complained that in 2013, when she recently sold a property and was holding the proceeds in a deposit account.

“Ms M was assessed as being prepared to take a cautious degree of risk. But Ms M’s main concern is that the business failed to ensure her investments fully utilised her annual ISA (individual savings account),” the report states.

Ombudsman Doug Mansell, however, determined the advice had been suitable.

“Overall, I don’t think it was unreasonable to advise Ms M to take her benefits in 2011. Although she’s had to pay tax on the income, I’ve not seen evidence this had placed her in a worse position than if she’d left the benefits until a later time,” Mr Mansell said.

“It’s also not clear Ms M had suffered any appreciable loss through not having part of her investment within an ISA.”


Despite this, the ombudsman decided to uphold the complaint “in part”, saying David Stock & Company should pay Ms M £100 for “the trouble and upset she’s been caused”.