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Financial Ombudsman Service (FOS) Finding Against Gerard Associates

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Earlier this year in April, the FOS issued a final decision against financial advisers, Gerard Associates Limited, in relation to a pension transfer. The full decision can be found here.

The case concerned Mr C, who complained about the appropriateness of the transfer of his Friends Life pension fund to the London Quantum Retirement Benefit Scheme (LQ RBS). The transfer was arranged by Gerard Associates, following which investments were made into various funds including:

  • Quantum Managed FX Fund
  • Colonial Capital US Housing
  • Best Car Parks
  • Best ABC Bond

Mr C initially complained to Gerard Associates about the appropriateness of the investments. Gerard Associates rejected Mr C’s concerns on the basis that they had not given advice but had provided all the information required for him to make the decision himself about the transfers. Mr C therefore referred his complaint to FOS.

The Financial Ombudsman Service

The Financial Ombudsman Service was set up by Parliament to resolve complaints between financial businesses and their customers. They help with a wide range of financial services, including pensions and investments. If a complaint is upheld following their investigation, then FOS has power to put the basis of that complaint right.

After investigating the complaint, FOS found that under relevant regulations, Gerard Associates were required to assess the appropriateness of the transactions, something that they had failed to do.

FOS found that Gerard Associates should not have processed the transfer of Mr C’s pension and there was no need for Mr C to transfer his personal pensions. There was no need for Mr C to transfer into LQ RBS; and the investments in that scheme were clearly unsuitable for him.

The complaint against Gerard Associates was therefore upheld.  Following FOS’ decision, Gerard Associates will be required to pay Mr C compensation for his losses.

TLW Solicitors’ View

Peter McKenna, Managing Partner at TLW Solicitors, said:

“This final binding decision by an Ombudsman at FOS against Gerard Associates confirms our stance on these cases as to the appropriate level of advice an IFA needs to provide to their client, even when they consider the client has instructed them on an execution basis only.

The regulations that IFAs must adhere to are strict. When transacting pensions on a non-advised basis, IFAs must assess the appropriateness of the service or product offered or demanded.  This includes assessing whether the client has the necessary experience and knowledge in order to understand the product or service.  If they fail to do so then they potentially fall foul of the regulations.

Our specialist lawyers are currently dealing with a number of cases against Gerard Associates in circumstances similar to the FOS decision above. This final binding decision will hopefully strengthen our cases further”.

TLW Solicitors can help

If you think that you, a friend or loved one may have lost out after receiving bad pension or investment advice, then please get in touch with one of the specialist financial mis-selling lawyers here at TLW Solicitors for a free, no obligation discussion.

You can either ring us on 0800 169 5925, email info@tlwsolicitors.co.uk or complete the callback form below.

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