Possible to sue over bad advice?

kungfumaster

Is it possible to sue or do something regarding terrible and incorrect advice from bank.

Basically I wanted a low risk investment and was recommended by Halifax an investment plan. A year later this plan has dropped 20%!!!

How can this be classed as low risk?

superstar_2

I highly doubt it. They gave the advice but you made the final decision which is all it matters.

dunstonh

Is it possible to sue or do something regarding terrible and incorrect advice from bank.

You can start legal action although it is damned hard to prove misconduct.

Basically I wanted a low risk investment and was recommended by Halifax an investment plan. A year later this plan has dropped 20%!!!

Low risk could have seen a 20% loss potentially. It really depends on what your definition of low risk is compared to theirs.

As Halifax employ tied sales reps, their responsibility is to ascertain your risk profile and present the fund options available to you for you to choose which you want (unlike IFAs who have to recommend the fund portfolio).

If you think a mis-sale has taken place you can make a complaint to the Halifax. However, you cannot complain about investment returns.

Perhaps if you can tell us the investment funds recommended we will be able to say if they match low risk or not.

kungfumaster

The plan taken was the Property Investment Plan which invests in commercial properties and rent. Obviously, in hindsight, this was a terrible choice! We specifically asked for low risk and was presented with this one. A 20% loss really doesn't appear to be low risk.

At the moment, it's a heavy paper loss and really undecided whether to crystallise it by taking it out or leaving it in there for and hope for the best. Maybe the best thing is the take it all out for the meantime, and take the hit on the chin, and reinvest at the later date.

greco_2

You can only sue if you have received negligent advice and not because the investment lost money.

I don't know what you mean by a heavy loss, but that would imply a large investment in which case, your money could have been spread out across different asset classes instead of just going into property. You've suffered through bad timing in buying at the top of the market.

dunstonh

The plan taken was the Property Investment Plan which invests in commercial properties and rent. Obviously, in hindsight, this was a terrible choice! We specifically asked for low risk and was presented with this one. A 20% loss really doesn't appear to be low risk.

That is low risk. So, complaint wont be upheld on that basis. Remember that you invest for a period in excess of 5 years. Last years loss was the first in 14 years.

Also, as I said above, you picked the fund to invest in. 100% into property is a bad move but you saw a tied agent and you made that choice. That is a limitation of the tied sales process.

kungfumaster

Yes it was a large investment hence the heavy loss. Surely theadvisor should have advised us to spread our risk (even though we should have possibly known this ourselves).

So the million dollar question is, shall I withdraw the money until the dust settles a bit ( a year or so) then plough it back it or just leave it there and grin and bear it?

TH1878

What are the options available with regards to switching funds etc? The outlook for Property over the next 12 months is equally poor.

greco_2

Personally I would grin and bear it as property will eventually recover. The question really is, can I put my money into an alternative low risk fund which will deliver better returns?

dunstonh

Surely theadvisor should have advised us to spread our risk (even though we should have possibly known this ourselves).

They are not IFAs. They are tied sales reps. They dont have the remit to portfolio plan in the same way IFAs do. That was the key error here. Yes its rubbish investing (100% into any area is) but its not something you can complain about. Especially with a tied agent. I can undestand your fustration though. I bet you wont see a tied agent ever again (from next year the FSA has proposed that they will no longer be able to present their sales as advice or use the title adviser).

You decision going forward is to either get the portfolio spread more and in line with your risk profile either by using an IFA or doing it yourself. Or you could cash it in and crystallise the loss or do nothing.

ChloeRadshaw

greco wrote: »

Personally I would grin and bear it as property will eventually recover. The question really is, can I put my money into an alternative low risk fund which will deliver better returns?

Dont be such a moron - The mortgage market is choked - No banks are lending - Whos going to buying property.

Property is the WORST asset class to be in and the pain has just started.

I hate these INI IT FOR THE LONG term -

Just remember ig you bought a FTSE tracker 10 years ago you woul be sitting on a loss right now -

Is 10 years LONG TERM? No? Maybe 100 years then???????