The Financial Ombudsman Service has told an intermediary to pay a client £500 despite there being limited evidence of any advice being given.
A client, referred to as Mr R, said he received unsuitable advice to transfer pension benefits from a personal pension to a small self administered scheme by an appointed representative of Joseph Oliver - Mediacao de Seguros LDA.
Mr R said he was advised to transfer his personal pension plan to a Ssas to invest in a company to be set up specifically for this purpose.
This company would in turn lend this money to Mr R for use in his business.
But while the Ssas administrator refused to set up the scheme so the transfer never took place, Mr R said he had borrowed money in anticipation of receiving the funds from the Ssas and had been inconvenienced by this.
The Fos ruled the advice was unsuitable even if it wasn’t acted on and despite Mr R not suffering a financial loss.
Ombudsman Michael Stubbs said: “Notwithstanding the fact that the adviser wasn’t qualified to give financial advice and the advice actually given was outside the scope of the principal’s permissions, my conclusion is that the principal authorised the AR to provide regulated investment advice.
“The principal is therefore responsible for the actions of its AR.”
Joseph Oliver was told to pay him £500 despite arguing there was no evidence that their appointed representative had advised Mr R.
It conceded the arrangement could have been an execution-only one or he had been referred to a specialist pension adviser.
Mr Stubbs said there was very little evidence to try and establish exactly what happened in relation to the pension transfer – only a single email exchange between the appointed representative and Mr R.
There was an email that confirmed a meeting was to be held and what Mr R should come to this meeting with – which was a pension statement and various identity documents such as a utility bill and a passport or driving licence.
Based on the limited evidence, Mr Stubbs said it is "more likely than not that the regulated activity of advising on investments took place".