Unreliable Financial Advisor

Georgevoller

I recently invested some money with a "reputable" financial advisor. He invested my savings and consolidated all my pensions into Templeton Bric. At the time of taking this out I didn't realise how high risk the fund was and basically, although it made alot of money in the first year or so it has now lost quite a lot. Since it has been losing my advisor and not given me any advice or been in touch - it was only when I noticed how much I had lost that I took action and he moved it to another fund - but I am now considerably down on how much I should have. I have stopped paying into the account and moved my funds over to a better advisor (I am sure he is ok this time!) but do not know what to do about my original advisor as basically he didn't give me any advice at all. Thanks Jill

Aegis

Assuming you asked for proper investment recommendations as opposed to telling him exactly what to do, you should put in a complaint to him or his firm. After 8 weeks or an unsatisfactory final response, you are entitled to take your complaint to the Financial Ombudsman Service, who will investigate whether the advice was irresponsible or not.

Bundling all of your savings and pension investments into a single sector-specific fund is almost certain to be deemed unsuitable advice. In addition, unless you came out off the scale on the risk spectrum, there's insufficient diversification to bring the risk down to suitable levels.

If you choose to complain, you should consider the following:

• Was a risk profile analysis conducted at all?
• Did you request a concentrated portfolio?
• Did the adviser justify why he was recommending such a concentrated portfolio?
• Could you have been considered a sophisticated investor with ample other investment portfolios dotted around?
• Were you apprised of the various risks associated with single-sector investing at the time of the recommendation?

Your new adviser should be able to offer more guidance on the complaints process you can go through.

dunstonh

Since it has been losing my advisor and not given me any advice or been in touch

Did you employ the adviser on a servicing contract or transactional?

basically he didn't give me any advice at all.

Was it formal advice or just a tip or a comment?
Was it part of a wider arrangement or single investment? (normally considered bad to use a single sector fund by itself)

Archergirl

Did you not fill in a risk assesment form to let your FA know your attitude to risk?
If not I would have thought you have a complaint against him.
We went all through our attitude to risk and what we wanted for the future when we saw our FA the first time.

jimjames

Georgevoller wrote: »

but do not know what to do about my original advisor as basically he didn't give me any advice at all. Thanks Jill

I'm not sure what you mean here. If he didnt give any advice at all then how can he be responsible for the performance of the fund. It seems highly unusual to have an entire portfolio or pension in a single fund. Are there other funds that you have elsewhere?

When you say the fund is lower than it should be, is it still higher than the money you invested to start with?

sabretoothtigger

BRIC is better then money in Washington, it certainly seems more balanced in application. Yet if you send money to politics you'd be better off right now, doesnt mean the IFA was a bad adviser

This is why I'd just DIY as if you havent the trust then dont tell someone to choose for you. Not many will give you instant results and in your case it went down later which is totally normal with every investment. Sounds like you wanted to never risk losing money which means cash savings

Jegersmart

Hi Jill

I am not sure of the point you are making? You cannot simply state that an advisor is unrelibale because you didn't make as much money as you had hoped.....?

Maybe I have misunderstood something?

J

dunstonh

Jegersmart wrote: »

Hi Jill

I am not sure of the point you are making? You cannot simply state that an advisor is unrelibale because you didn't make as much money as you had hoped.....?

Maybe I have misunderstood something?

J

It is way too vague at the moment. Until we get some answers to the questions asked, we cant tell. We dont even know if it is an advised case or execution only/DIY.

GeorgeHowell

The best advice anyone can be given is not to use a financial advisor.

gadgetmind

Georgevoller wrote: »

I recently invested some money with a "reputable" financial advisor.

How recently?

He invested my savings and consolidated all my pensions into Templeton Bric.

Everything into a single fund and a highly-volatile area? That seems odd, to say the least. Oh, and it's not even a good fund in that area and consistently under-performs its benchmark.

it was only when I noticed how much I had lost that I took action and he moved it to another fund

That would seem to be more than a little hasty. You should have complained to the advisor, asking him to justify the advice, and generally made it his problem.