The Financial Ombudsman Service has upheld a claim on behalf of five investors over the suitability of advice related to a film tax avoidance scheme.
The Financial Times reports the Financial Ombudsman Service ruled the advice given by IFA firm 20Twenty Independent to invest in Crossover Film Partnerships was “unsuitable”.
The FOS can only award redress of up to £150,000. It can advise firms to pay more but this is not binding. If investors do not want to accept the ruling they can pursue the firm in court instead. However, there have been two contradictory high court rulings recently on whether someone can accept the FOS award and pursue the firm in court for additional redress. Ths issue is set to be decided in an upcoming appeal hearing.
The FOS found investors should have been made more aware of potential losses from the scheme that could have cost three times their initial outlay.
Claims firm Rebus Investment Solutions, which acted for the investors, told the FT the win was the “tip of the iceberg” but it is understood the case is based on a speciifc product with no FOS precedent expected to be set.
Rebus head of client relations Martin Taylor said the firm was handling claims from more than 600 clients against 100 advisers with assets worth more than £40m. By the end of the year Taylor hopes to recoup £10m.
20Twenty Independent Ltd declined to comment.