A claims management company has withdrawn a claim against a financial adviser citing a “misunderstanding”, after the clients wrote a complaint letter to the Ministry of Justice stating they had never intended for their complaint to be brought against the intermediary.
In July 2012, claims management company EMC Advisory Services cold-called clients of Ian Osang, IFA at Ingard Independent Financial Management.
After asking about the clients’ investments the company offered to raise a complaint over the lacklustre performance of one product, saying they could be eligible for compensation.
The clients gave permission for the firm to go ahead with proceedings, but when a complaint was received by the IFA they claimed to have made clear their permission was given for a claim against the product provider and they were not dissatisfied with their adviser.
Mr Osang and the clients composed a letter which the clients signed and sent to the Ministry of Justice Claims Management Regulation Unit, which regulates CMCs.
Following this complaint and questions from FTAdviser, Emcas later wrote to the client to state that the claim had been dropped after it had reviewed its recordings of the call and identified potential for misunderstanding.
In the letter to the clients, Emcas said the recordings revealed that after the clients stated that the product had been sold by an adviser, the operator told them the adviser would not be held personally responsible.
It said the operator had wrongly assumed that the adviser the clients referred to was an employee of the product provider.
Speaking to FTAdviser, Lewis Harvey, compliance and customer services manager for Emcas, said: “Later on in the conversation, Mrs Gordon did say that the adviser was independent and so my colleague should have explained then that the case would go against them, but she didn’t.
“Mrs Gordon did refer regularly to the investment provider and so perhaps my colleague should have picked up on this because it indicated that the dissatisfaction was with the provider and not the adviser.
“Mrs Gordon also mentioned that the adviser had recently visited. This suggested that there was an ongoing relationship which my colleague should have been sensetive to.”
Mr Harvey confirmed that Emcas had withdrawn the complaint against Mr Osang and that the company had also altered its training and telephone scripts to make clear that where a product was sold by an IFA any complaint would be brought against them personally.
Mr Harvey said: “Having reviewed the tapes and correspondence in this matter we can see that there was room for misunderstanding about the claims process. We instituted changes to our scripts for all savings and investment claims on 25 October on the back of this investigation.
“All potential clients will be clearly and simply informed, regardless of whether they know the status of the adviser, that in the case that a product was sold with independent advice, the complaint will be referred directly to the relevant IFA.”