How do I complain about a Financial Advisor?

We need all the good advice we can get to negotiate the minefield of finance. To get independent financial advice you would go to an Independent Financial Advisor (IFA). But what happens if their advice doesn't work out how you planned it?

If you have lost a lot of money and you believe it is directly down to being mis-advised by an IFA, you may not want to risk losing further money and wasting time on a legal action. However, that should be the absolute last resort. The Financial Services Authority (FSA) has an Ombudsman bureau, a service which is free to consumers that you can use. It is not expensive, but it can be time-consuming, however, it could be worth it.

The first step you should take should you feel there is cause for complaint is to contact the firm. Before you even use an IFA, you should check that it is actually regulated by the FSA. If it is not, then don't use it, because there's a reason that it isn't subject to regulation. If they are regulated by the FSA then they will need to have a complaints procedure. Some IFAs though are so small that the person you are complaining to could well sitting all day next to the person you are complaining about.

This can thus end up quite personal, with the initial response from the IFA being one of outrage, shock or disappointment. Some of them may have been in business for many years with no complaints. Yet once a complaint comes into an IFA the standard reply deadline is within seven days. There needs to be an independent investigation, by someone other than the person you are complaining about and by someone with the correct qualifications and training.

You should remember that in some situations you can't do anything about the advice you've been given, even if it was bad. The first one is if the correct information was given but was never read, and the other is when the investment has simply not performing as well as hoped. The IFA cannot control this.

After you have raised the complaint, its not much different from complaining about an insurance company. The company must perform their investigation within 2 months, after which you can take it to the Ombudsman. Should the investigation complete and you are not happy with the outcome, you can go to the Ombudsman, making sure you've supplied the correct documentation.

The Ombudsman will check your complaint for relevance, and then will investigate and adjudicate. Their decision is binding on the firm abut not you. So if you don't agree you could still got to the courts.

 

 

 

 

 

 

 

© AskFinancially.com 2008

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