HL is profiting from disgruntled customers who want to transfer their money elsewhere

Reaper

The reader, who wished to remain anonymous, bought Mr Woodford’s smaller Income Focus fund based on Hargreaves Lansdown's recommendation. He has since lost around £2,500 from the investment and wishes to move to another broker.

He's moving because of the recommendations? That doesn't make sense. You can use any brokers recommendations while staying with HL. As far as I know they all make them public. Here's BestInvest for example:
https://www.bestinvest.co.uk/research/top-rated-funds/search

SonOf

And remember that HL didn't give recommendations. It gave a marketing list of funds it wanted to promote. That wasn't advice or a recommendation.

Jonbvn

SonOf wrote: »

And remember that HL didn't give recommendations. It gave a marketing list of funds it wanted to promote. That wasn't advice or a recommendation.

Agreed that the Financial Ombudsman will not find in favour of the investor in this case. HL and all other brokers are very specific about "recommendations". The Wealth 50 or 100 was never a recommendation. Further brokers make it abundantly clear that they provide an execution only service.

The case that the FCA could consider is whether such "best-buy" tables should be provided by brokers, since they are clearly being misunderstood by unsophisticated investors.

talexuser

Jonbvn wrote: »

whether such "best-buy" tables should be provided by brokers, since they are clearly being misunderstood by unsophisticated investors.

That's precisely the problem, but without them (from ALL brokers) how do you whittle down to those funds worth investigating in detail for DIY? The good ones try to go beyond a simple 5 year top of the table and try to look at volatility, risk, sustainability, sector trends etc. I just wish more of them would compare to the nearest comparable tracker - but that would be self defeating for a broker, wouldn't it?

Reaper

I shouldn't have used the word "recommended" and did so only because the article had. However it is clear people do think the "best buy" tables are recommendations.

HL's tables in particular have come in for a lot criticism over the years for self interest.

It is useful for novice investors to have some way of cutting down the thousands of choices into something more manageable. Maybe try more independent categories such as Morningstar who award "analyst ratings".

masonic

jaybeetoo wrote: »

If they welcome the plans that much why haven’t they scrapped their fees already without intervention from the regulator?

No doubt they'd tell you it is because it would put them at a disadvantage vs some of their competitors (although II recently scrapped its exit fees, Cavendish, Halifax and Vanguard don't have exit fees, and AJ Bell and iWeb have no account closure fee).