Advisor didn't inform me of all the charges... what can I do?

lockview
lockview Posts: 16 Forumite
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in Savings & investments
After some advice.

I opened a product RL360 (Royal Life) as recommended by my advisor (Abbey Wealth). At the time I opened the product, I was provided with an email from the advisor detailing the charges, along with literature from RL.

Neither email or literature referred to a 'custody charge' which was then later applied to my account after each transaction, and over the course of a few years, totals +£1,000.

I have since closed the account as my circumstances changed and it wasn't efficient for me (nothing to do with these charges).

At the time of closing, I noticed all these charges and queried them with my advisor. They emailed me agreeing that the custody charge info was missing from the literature and would take it up on my behalf with RL.

Long story short, the advisor says they are not liable as: "these documents issued in conjunction with the application form were provided on behalf of RL360 as mandatory documentation that should be issued to clients in order to be in a fully informed position."

RL say they are not liable as "it is the advisor's responsibility to ensure potential policyholders understand both the benefits and limitations of our policies, and also explain the costs and charges associated with the policy."

Both advisor and provider have refused to accept responsibility and neither is willing to refund me the charges taken.

Who is in the wrong, and what can I do?

If it makes a different Abbey Wealth is registered in Spain and Ireland.

Any help, much appreciated.

Thanks

Comments

  • Reaper
    Reaper Posts: 7,280 Forumite
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    If you were based in the UK and it's a UK Financial advisor then it's time to appeal
    http://www.moneysavingexpert.com/reclaim/fight-back-fos

    However I know Abbey Wealth (previously called Abbey Financial Solutions) targets ex-pats so if that is the case you will have to go through the procedure in the country that applies, if any such appeal procedure exists.
  • lockview
    lockview Posts: 16 Forumite
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    Reaper wrote: »
    However I know Abbey Wealth (previously called Abbey Financial Solutions) targets ex-pats so if that is the case you will have to go through the procedure in the country that applies, if any such appeal procedure exists.

    Thanks for the reply. I am based in Japan (although moving back home to UK next month). I'm a bit confused as to which country procedures I should be checking...? Spain (location of office I had dealings with), Ireland (where they are co-registered along with Spain), or Japan as that is where I was residing at the time of investment?
  • Reaper
    Reaper Posts: 7,280 Forumite
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    I'm afraid I can't advise as I am not familiar with the laws in all the countries involved. My feeling is the advisor is mostly at fault as they sold a product without understanding it, or if they did failing to tell you how it worked.

    I feel they should compensate you and then it is up to them whether they in turn try to recoup the money from Abbey. That part doesn't involve you.

    However I know foreign "advisors" often turn out to be nothing more than salesmen who prey on ex-pats selling them whatever pays the most commission. The regulatory framework we have in the UK does not exist in many other countries. I suspect your chances of compensation are low but it depends on the law where they are based and your determination to pursue it.
  • AnotherJoe
    AnotherJoe Posts: 19,622 Forumite
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    Seems to me any company with the word "Wealth" in it should be steered well clear.
  • bostonerimus
    bostonerimus Posts: 5,617 Forumite
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    Expat finances can be a minefield. I don't have any idea whether you can claim any refunds, but I would say that it might be a useful education. Nobody is going to take better care of your money than yourself and I would keep the middlemen to a minimum when managing your money.
    “So we beat on, boats against the current, borne back ceaselessly into the past.”
  • lockview
    lockview Posts: 16 Forumite
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    Looks like I might be able to complain to the FSO in Ireland. Anyhow, I've written back to Abbey Wealth for a final decision and then will see whether FSO Ireland can help me.

    I am amazed at the expense of the product that was sold to me, but more amazed I didn't realise at the time. I think that is motivating me to have something done about these charges. Anyway, we live and learn... fortunately most of my investment was returned. Just a shame that after a number of years I came out with less than I started with... should have just put it in an index tracker!
  • bigadaj
    bigadaj Posts: 11,531 Forumite
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    AnotherJoe wrote: »
    Seems to me any company with the word "Wealth" in it should be steered well clear.

    It's similar to any country that has the word 'democratic' in its name, in both cases the naming might be relevant to the people in charge, but rarely the average person or customer.
  • sandsy
    sandsy Posts: 1,719 Forumite
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    Tricky with the overseas elements and a non-UK registered adviser.

    I'd have a go at both. You're already pursuing the adviser. But I'd lay a complaint with RL that although the adviser provided you with their literature, the literature itself was prepared by RL. Was there a personal illustration at all when you bought the product? That would have been prepared by RL and should have shown all charges. Or any charge sheets detailing different types of charges - again, RL's responsibility to get that right. They can't just pass on responsibility for their omissions to a third party.
  • dunstonh
    dunstonh Posts: 116,354 Forumite
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    In the UK there are multiple disclosures. So, it is quite hard to claim you don't know what the charges are.

    1 - fee agreement (client wet signature or e-signature required)
    2 - provider documentation issued by the adviser showing the charges
    3 - suitability report issued by the adviser showing the charges
    4 - provider/platform writes out to you verifying the charges

    So, if one or even two bits get missed, you should get something.

    The UK is highly regulated and operates to a higher standard than most regions of the world. So, don't expect UK standards elsewhere. Especially in the asia-pacific region.

    I am amazed at the expense of the product that was sold to me, but more amazed I didn't realise at the time. I think that is motivating me to have something done about these charges. Anyway, we live and learn... fortunately most of my investment was returned. Just a shame that after a number of years I came out with less than I started with... should have just put it in an index tracker!

    Offshore products are typically more expensive than onshore products. However, you are mixing up the investment fund with the wrapper/provider. The RL product would have had trackers available.
    I am an Independent Financial Adviser (IFA). The comments I make are just my opinion and are for discussion purposes only. They are not financial advice and you should not treat them as such. If you feel an area discussed may be relevant to you, then please seek advice from an Independent Financial Adviser local to you.
  • lockview
    lockview Posts: 16 Forumite
    First Post First Anniversary Combo Breaker
    Thanks for the info!
    dunstonh wrote: »
    In the UK there are multiple disclosures. So, it is quite hard to claim you don't know what the charges are.

    1 - fee agreement (client wet signature or e-signature required)
    2 - provider documentation issued by the adviser showing the charges
    3 - suitability report issued by the adviser showing the charges
    4 - provider/platform writes out to you verifying the charges

    So, if one or even two bits get missed, you should get something.

    The UK is highly regulated and operates to a higher standard than most regions of the world. So, don't expect UK standards elsewhere. Especially in the asia-pacific region.

    In my case, 1&2 happened but the documentation was out of date, and didn't include details of the 'custody charges'. The other charges were in line with the terms.

    dunstonh wrote: »
    Offshore products are typically more expensive than onshore products. However, you are mixing up the investment fund with the wrapper/provider. The RL product would have had trackers available.

    Good point. At the time I was deciding between offshore (expensive) wrapper with managed funds selected by adviser vs. onshore investment account with self-selected index trackers. In the end I did both, but with hindsight the better decision would have been just to do the trackers outside of the expensive wrapper.

    An expensive lesson learnt, but I think the comments about cutting out middlemen and doing your own research etc. are the way forward for me!
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