Share help please!

ELT_2

New to this board, but hoping someone can offer some sage advice.

About 9 years ago, my mum invested some money in a company - recommended by a financial advisor. She was told he was going to be building and selling properties in Spain. She was given a printed share certificate.

In the last 9 years she has asked a few times for updates, and been told there's no money. Or that the properties are being rented, and not sold. She hasn't seen any money. This person is now being difficult, and she really wants to know what's going on, and get her money back, if she can.

I've done some research and the name of the company is a limited company in the UK. I've found all the details of its annual returns, and all the shareholders (including my mum) are listed. So it seems legit.

How can she sell? Is there anyone that can advise further? I know there's the financial ombudsman service, which helps people, but I believe there's a time limit of 6 years. I'm worried because she invested this money during a vulnerable time in her life, and now I feel she is being taken advantage of.

All help gratefully received!

Lokolo

Being a legitimate company doesn't mean they are regulated and allowed to give out financial advice.

I don't believe the FOS/FCA will do anything unless they are regulated.

https://register.fca.org.uk/

Check here.

ELT_2

So the financial advisor company IS registered (although it says authorised but applied to cancel)...although the company she has bought shares in is a separate entity to this. Albeit owned by the same person.

jimjames

You need to see exactly what was on the paperwork, what did she sign up for? Is this her only investment or does she have a large investment portfolio that this is a part of?


Are the firm IFAs? (Independent financial advisers) Maybe if you give the name of the company others may be able to suggest options

ELT_2

Yes, the firm is an IFA. An individual at the firm advised her to invest money in another company, which he is listed as a director of.

The only paperwork she has is a share certificate for 50,000 shares. This is her only investment. She's listed as a shareholder in all the documentation held by Companies House.

kazwookie

How much money did your mother 'invest'?

ELT_2

kazwookie - does that make a difference? I'm really just trying to help her out, and looking for some advice on how she would go about selling them.

eskbanker

This sounds like a clear conflict of interest for an IFA to recommend investing in a firm he's a director of! I'd suggest a formal complaint to the IFA company, unless he's the main player there, with escalation to the FOS an option if that doesn't bear fruit.

Unless there's any clue from the share documentation or via annual reports, etc, actually selling the shares for a meaningful consideration doesn't sound like a viable option, so getting the money back may get quite messy and dependent on proving a mis-sale in the first place....

Eco_Miser

ELT wrote: »

Albeit owned by the same person.

Actually, that company is owned by your mother and the other shareholders.
Is your mother's holding a significant fraction of the whole?
Is the director who advised her also a significant shareholder?

steampowered

She will probably be able to sell her shares, assuming the articles of association of the company (which are available on the Companies House website) allow her to do this.

The real question is whether anybody would be willing to buy the shares. There are not many people willing to buy minority shareholdings in a private company.

Are the directors of the company the same person as the IFA? If not, it would be worth asking them.

Did she ever get a brochure or other documentation from the IFA at the time of investing?

Unfortunately if this was a Spanish property investment made 9 years ago, there might not be anything left. That would mean she invested in 2007 just before the financial crisis - and Spanish property was very badly hit.

ELT_2

I have found the articles of association, although I'm finding it hard to understand them. Is a shareholder the same thing as a Member?

The person from the IFA that recommended she invest is also a director in the company she invested in.

She has no other documentation other than a share certificate.

Can anyone recommend someone that might be able to advise my mother? Would another reputable IFA be able to help?