I am writing in response to the news about an adviser who has been told to compensate a client after recommending he transfer four of his pension plans to another provider.
I have been banging on about this since 2007, when I had a light-bulb moment. Suitability reports are about as much defence as a chocolate fireguard when it comes to Fos.
The suitability report can bear little or no resemblance to what was said to a client and does not show intent of either party. We started recording client meetings in 2007 (and all phone calls) after I was introduced by a solicitor to a 75-year-old client whose previous solicitor had cocked up her deceased husband’s will. She did not have a good word to say about the old solicitor, the new solicitor or any financial institution, and yet she had £450,000 on deposit with Northern Rock.
I felt she was an accident waiting to happen and hence agreed with her and her daughter who was also present as a trustee and beneficiary of some of the late husband’s estate that we would record the meetings, which we did.
We moved the monies out of Northern Rock, and after a deed of variation, large amounts were placed in trust in relatively low-risk portfolios of investments.
She then refused to pay the solicitor’s bill, and to save a battle, I paid it from the fee I had charged, thus reducing any profit we might have made.
Northern Rock, as we know, collapsed, and thanks to my advice she and the trust did not lose a penny, but the portfolio went down by about 5 per cent in the short term. She then made allegations about what I had said and omitted via a new solicitor, having complained about the one she never paid, forgetting to tell them the meetings had been recorded. After getting the solicitor to be specific instead of generic, we provided them with an edited as well as a full version of the recording so they could hear each allegation rebutted in turn.
Surprise, surprise, the complaint disappeared and I heard on the local grapevine she complained about this latest solicitor and her new adviser who had taken over the assets we had been advising on.
Phil Castle
IFA Financial Escape,
Ramsgate,
Kent
