£2,400 Compensation for Mis Sold Stocks and Shares ISA

Author:
Graham Harris
Mis Sold Investment Claims Manager
Date:
30/11/2020

A Mis Sold Investment Case Study - Client Situation

In 2000, Ms B, who lived in Scotland, was left with no choice but to take redundancy, and early retirement, from her job where she had worked for around 15 years.  This was because she had arthritis and had two knee replacements because of it.

After receiving a redundancy payment of around £5,000 and depositing this into her bank account, it was suggested that she meet with a financial adviser to discuss options for this money.

Ms B spoke to a Financial Advisor at Lloyds Bank and she then invested £3,500 of her redundancy pot into a Stocks and Shares ISA. The investment was made into the UK Growth Fund, which was a medium risk investment.

Because she had been forced to take early retirement due to health problems, she was in a situation where she could no longer work and the redundancy money she had was most of her savings. She invested the money quite quickly after her redundancy and didn’t really have time to get used to her new circumstances and income levels.

When Ms B closed her investment in 2005, she was paid back £4,530 so the return on her investment was just over £1,000 in 5 years.

How We Helped

Ms B got in touch with our Mis Sold Investment Claims specialists and spoke to Manager Graham Harris in June 2020 to discuss her investment and whether we could help her.  

Her investment was 20 years old when she got in touch, so she didn’t have any information about the investment so Graham contacted Lloyds Bank on her behalf, after she’d given us her authority to do this. Graham and Ms B had a conference call with Lloyds to get all the information about her investment.

Once we had the information from Lloyds Bank, Graham had a detailed conversation with Ms B about her situation and circumstances at the time of her investment.

It became clear that she had been given unsuitable financial advice. This is because:

  1. She was advised to take too much risk with her money – she was a first time investor who was advised to put her money into a medium risk investment.
  2. It was not the right time for her to invest – she had just been made redundant and forced into early retirement due to health problems.
  3. She invested 70% of her redundancy money, which was most of her savings. This was too high a proportion in her financial circumstances.

Graham put those concerns in writing to Lloyds Bank, who had 8 weeks to reply to the complaint. They agreed with all of the concerns about Ms B’s investment.

The Outcome

Ms B was awarded £2,464 in compensation from Lloyds Bank for her mis sold stocks and shares ISA investment, even though she didn’t actually lose any money.

Her mis sold investment claim only took 3 months from start to finish.

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