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Investment Mis-Selling by Financial Advisors

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In cases of financial mis-selling, those caught out by fraudulent
schemes can be left feeling embarrassed and at fault.

Acting under the trusted opinion of financial advisory firms, investors can lose thousands of pounds in arrangements not suitable to their needs.

As recently reported by TLW, even Premier League footballers with access to high-end financial advice have been duped by investment scams. It goes to prove that financial mis-selling can happen to anybody.

Victims of financial mis-selling may find they have been sold a product or service that is not suitable for them, and subsequently lose substantial amounts of money when the returns on the investment promised from the outset aren’t delivered.

It may be a result of poor advice, where advisers have failed to inform their client of the potential risks and other important pieces of information. This information can sometimes be vital in allowing an investor to make a properly informed decision about what is being offered to them.

The uncertainty that surrounds financial advisory firms has come to light after the Stirling Mortimer scandal, in which ‘fractional ownership’ investments across Spain, Morocco and Cape Verde in the west coast of Africa saw 24 Independent Financial Adviser firms registered default by the Financial Services Compensation Scheme (FSCS).

Many investors were caught out by the scheme due to it being sold to them as a ‘low risk’ investment, yet after its investigation, the Financial Ombudsman Service ruled that the funds could only be described as ‘high risk’.

More recently, Tory MP, Robert Buckland, has fallen under investigation after he invested in a film partnership scheme, currently under inquiry for tax avoidance from HM Revenue & Customs.

A long-term member of the Invicta Film Partnership, and also an investor of the Reel One Partnership and Future Screen Partners 2006, Robert Buckland insisted:

“Before making [the investments] I asked an independent, accredited financial adviser to look into the companies, who found them to be completely beyond reproach.”

The Invicta Film Partnership No. 25 is a sale and leaseback scheme. Film rights are purchased by a partnership of investors before it is due to be released. It is then leased back to the producers or distribution company by the investors. Alongside many other film partnership schemes, the Invicta Film Partnership No. 25 is under investigation concerning tax liabilities.

The same can be said for the Eclipse Film Partners No. 35 LLP – uncovered as a tax avoidance scheme, football ace Nobby Solano is one of many investors facing high tax demands. It is unknown whether the investors knew the full details behind the scheme’s management.

Unfortunately, this lack of knowledge and understanding of the processes behind more complicated investments – things perhaps only known by their financial advisers – can sometimes be the reason why some investors lose out.

In some circumstances, the advice offered does not have the best interests of the investor in mind. Whether trusted advisors purposely embellish or omit details from risky investments for their own gain, or simply don’t understand their client enough to judge the suitability of the investments they recommend, there is no doubt that poor financial advice can lead to significant financial losses for those who are persuaded to invest.

TLW Solicitors are expert financial mis-selling solicitors. If you believe an investment gone-wrong is due to poor financial advice, we may be able to help. For more information or to discuss the particulars of your claim, contact us via our enquiry form or call free on 0800 169 5925.

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