FOS to issue guidance on handling Barclays' fund complaints
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The Financial Ombudsman Service will issue guidance to adjudicators on how to handle complaints regarding the suitability of the Aviva global balanced income fund sold by Barclays.
Last April, Money Marketing revealed that Barclays advised clients approaching or in retirement to transfer long-term savings into the single specialist fund.
The value of the fund plunged by almost 50 per cent in the 12 months to March 2009.
The bank has admitted it erroneously categorised the fund as balanced rather than adventurous between July and November 2007.
A FOS spokesman confirmed that a number of adjudicators have asked for guidance on how to judge the suitability of the fund for various investors and are waiting to proceed with individual complaints.
He says: “The guidance will not set a precedent for individual cases, which will be looked at on an individual basis, but the ombudsman will form a policy on how to determine the suitability of the fund.”
He could not give details of when the guidance would be issued to adjudicators.
David Allan Financial IFA David Allan says: “My client’s complaint has been with the ombudsman now for over six months. How long does it take to make a decision about a fund? Nearly all these complainants are elderly pensioners desperate for income.”
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Readers' comments (4)
Anonymous | 20 Jan 2010 4:04 pm
Shame they do not have the integrity to admit that they targetted sales staff to sell this fund because of the high trail commission. You would not exoect them to do a Standard Life and offer blanket compensation
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Anonymous | 20 Jan 2010 4:11 pm
I have some simple guidance for them.
"PAY UP!!"
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Jim Roberts | 21 Jan 2010 10:03 am
There are a number of issues here:
1. It's not just the categorisation of the fund which is at fault, but the assessment of the investors as "Balanced". It seems that so long as you were still breathing, you were a "Balanced" investor (even a 91-yr-old, according to the Daily Mail).
2. Why has the FSA been totally silent on this systemic mis-selling? The cases which make it to the FOS are a small proportion of the total who have been screwed. Many others complained to Barclays and were told that in the bank's opinion, they had not been mis-sold. Few of them take it any further. Barclays, and the other banks who have also been acting in this way, should be forced to review every single case that they have sold in the last 3 years, even those where no formal complaint has been made; every client should be written to, informing them there may be a case for compensation, in the same way as was done for Endowments and Pensions.
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Anonymous | 19 Feb 2010 5:50 pm
Isn't it the case that an IFA doing what Barclays have done would have lost his ticket?
When is the FSA going to impose non-financial penalties on the banks?
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