The Financial Ombudsman Service has rejected a call for compensation from a couple who claimed their adviser took commission without their consent.
A couple, referred to as Mr and Mrs L, complained they received poor service from Whichers IFA Limited and claimed their adviser took commission on a bond they held, without their consent.
Mr and Mrs L were concerned Whichers had been taking trail commission on a Prudential with profits bond they had taken out with another firm of advisers in 2001.
The pair also complained about the performance of a Standard Life investment following Brexit.
The Financial Ombudsman Service said they didn’t think it was realistic for the business to have predicted what the impact of the European Union referendum on Mr and Mrs L’s investments might be.
The ombudsman found evidence to show that reviews had been carried out and Whichers made a range of suggestions in response to Mr L’s concerns about the performance of the portfolio.
With regard to the Prudential bond the ombudsman said he felt a letter Mr and Mrs L had signed in December 2007 showed they had agreed to a transfer of agency of the bond to Whichers.
Reviewing the case, ombudsman Suzannah Stuart said: “It is always disappointing when an investment does not perform as well as hoped, as was the case with the Standard Life portfolio.
“However in order to uphold this aspect of their complaint I would need to be satisfied that the advice they received from Whichers to invest in the portfolio was unsuitable.
She said Whichers should not have to compensate the couple for the subsequent fall in the value of their portfolio and refuted the clients claims Whicher “manipulated a situation to obtain service payments”
Whichers confirmed to the ombudsman that it has not received any renewal commission (also known as ‘trail commission’) on the Prudential bond so Ms Stuart rejected the complaint.
She said: “Even if I accept that Mr and Mrs L did not agree to transfer the agency of the bond to Whichers - and the information on this is inconclusive - I don’t think they had been disadvantaged by the transfer.
“As this is the case I can’t reasonably require Whichers to pay them compensation as there is nothing to suggest that Mr and Mrs L lost out as a result of the transfer of agency.
“Nor is there anything that shows Whichers has receive any renewal commission for this bond.”
emma.hughes@ft.com
