When someone wishes to invest money, they may contact a financial adviser in order to make sure that their funds are used sensibly. Although the majority of these experts adhere to high professional standards, when an adviser acts dishonestly – or provides inappropriate or negligent information – those who have suffered financial loss as a result may be entitled to claim compensation.
In 2013, the Financial Services Authority (FSA) revealed the results of a mystery shop which investigated how banks were providing investment advice.
Conducting its research across six major banking firms, the findings suggested that the majority of institutions behaved adequately. However, around 25% of the organisations surveyed provided “poor quality” information.
More than 10% of the mystery shops also revealed that advisers were giving financial advice which was “unsuitable”. Furthermore, in some cases, staff members were failing to obtain adequate amounts of information from the consumer.
For example, the financial adviser did not appropriately establish the amount of risk which the client was prepared to take in 15% of cases, while 13% of the mystery shops revealed that employees provided advice which did not consider the consumer’s personal or financial circumstances.
Following the results of this mystery shop, the FSA stated that the banking groups involved were taking “immediate action” – which may prevent customers from receiving poor quality advice in the future.
However, if someone suffers substantial monetary loss after receiving inadequate financial information from an adviser, he or she may be entitled to claim compensation through a specialist professional negligence solicitor.
When an individual loses money after making an investment, he or she will usually have to prove that an adviser acted in a negligent manner when making a compensation claim.
For example, if an expert acted dishonestly, did not adequately explain the risks, or provided false information, those adversely affected could have grounds to make a professional negligence claim.
If you lost money after obtaining poor-quality information from a financial adviser, you may be able to benefit from an experienced George Ide solicitor.
Please contact us today to find out if you are entitled to receive damages.