The Financial Ombudsman Service has provisionally upheld a complaint against a Mint Financial Management adviser who recommended a client invest more than 50 per cent of his pension pot in a Stirling Mortimer Ucis fund.
In August 2007, the adviser recommended the 57-year-old client switch from a Legal & General personal pension into a Sipp. He advised him to invest £89,000 of his £173,960 pot into the Stirling Mortimer No.4 Cape Verde Fund.
In a provisional decision, seen by Money Marketing, the ombudsman says the investor wanted a medium or medium-to-low risk investment but was placed in the high risk Stirling Mortimer Ucis fund.
He has provisionally upheld the complaint, saying Mint should pay the client the value of the return he would have got had he invested in line with the Apcims income total return index.
The ombudsman says: “It seems to me that the only reason for recommending the transfer into the Sipp was to be able to gain access to the Stirling Mortimer fund, which I have considered unsuitable. The Stirling Mortimer fund should not have been considered an appropriate investment.”
Mint initially rejected the complaint, considering the advice to be suitable. The complaint was then referred to the FOS through law firm Regulatory Legal.
Regulatory Legal director Gareth Fatchett says: “This case shows once again the sale of unregulated products needs to be handled carefully.”
Mint was acquired by Intrinsic Financial Services in February 2008. Intrinsic was unavailable for comment.