A Hertfordshire-based advice firm has been ordered to pay a couple £10,000 compensation after changing the performance benchmark of their savings.
According to a Sunday Times report, a Financial Ombudsman Service investigation resulted in Wagstaffs Wealth Management paying compensation to couple David and Josephine Kelsall, who had saved more than £1m over 50 years.
The Kelsalls became customers of Wagstaffs in 2011. They were told the performance of their savings would be measured against the FTSE 100 index with dividends reinvested. However, in February, this was changed to being measured against the FTSE 100 without dividends being reinvested.
David Kelsall, who is an experienced investor and trained accountant, tells the Sunday Times said he did not understand what he was being told by Wagstaffs.
He says: “I just took the adviser’s word on trust. It was a rainy day, so I decided to go through everything. I soon realised there were discrepancies. It took me three days to work out what was going on and then two years to prove the case to the ombudsman.”
The FOS says the Kelsalls were misled. The £10,000 compensation represents a refund of one year’s advice fees as well as compensation for distress and inconvenience.
Wagstaffs told the FOS the change in the benchmark was “unfotunate” and it was not designed to mislead. It declined to comment for the Sunday Times article.