MSE News: Barclays to pay £60m compensation for investment mis-selling

I wasnt surprised by the redress they have had to pay as that was inevitable for such a basic error. The level of the fine was the main news for me as it was far higher than the normal 1-2 million that you normally see. Suggesting the issues at Barclays were wider than just an incorrect risk profile being applied to the fund.

Between those dates, Barclays sold to 12,331 people with investments totalling £692 million.

Just goes to confirm that the banks really dont have to offer quality products, quality investments or good value investments or even good advice. It just walks through the door. That is an average investment of £56,118 per person. Each and everyone choosing a low skilled sales force who could only sell from an expensive limited panel of providers when just down the road they could have obtained independent advice cheaper and including the whole of market.

dunstonh wrote: »

I wasnt surprised by the redress they have had to pay as that was inevitable for such a basic error. The level of the fine was the main news for me as it was far higher than the normal 1-2 million that you normally see. Suggesting the issues at Barclays were wider than just an incorrect risk profile being applied to the fund.

Same here.

I have a distinct (and unhappy) recollection of being a director of a Bank Insurance company. Abiding perceptions include:

1. Liaison meetings intended for Fund Managers to communicate with Life Product Managers about fund performance. Graphs showing abysmal performance compared to indices and competitors would never be discussed. Commission rates on new 'Structured Products' would be the only topic of 'interest'.

2. The ever increasing demands of 'compliance'. In the 'good old days' a life company had underwriters. Depending upon activity, you would need X underwriters to assess all the cases. However, the 'Fact Find Police' need to be there also to 'check' that the salesman has given 'appropriate' advice (an inexact science after the event). It is no joke when the number of these people starts exceeding X, and eventually needs to by a multiple of X.

3. An inbuilt culture that imposes a more 'softly softly' approach to the 'best' sales people. With a few easily spotted exceptions, the vast majority of such sales people are 'good' only because they 'sail close to the wind' with the customer. That's bad enough, but when this is rewarded by 'toning down' examination, it is no surprise what you get!

peterbaker wrote: »

Is this the first of the prosecuted financial services mis-selling scandals that comes with a "don't call us we've insisted that they'll call you" remedy?

No. Its normal practise for investment related issues where trends have been identified. It doesnt seem to get applied to other areas but it is quite common on investment backed products.

dunstonh wrote: »

Each and everyone choosing a low skilled sales force who could only sell from an expensive limited panel of providers when just down the road they could have obtained independent advice cheaper and including the whole of market.

Not an IFA by any chance, ah yes, so you are.

A very high proportion of IFAs are former banks and insurance salesmen of course and while they were flogging their employers wares, they were the bee's knees apparently. After they leave it appears most suddenly develop a conscience and it becomes apparent to them was all one shocking rip-off. The miracle of a Damascene conversion.

The poor behaviour of banks and the shifty salesmen they too often employ is very hard to deny but there rarely seems any gratitude expressed by IFAs for the lot who taught them their trade. Gives hope to all leopards who fancy a change of spots.