Mis-Selling Of Financial Investments
Mis-Selling Of Financial Investments
Timothy Capper
Some people believe that they have been convinced to purchase mis sold investments. This happens when people make it clear that they would like, for example, to place their money into a low risk fund. What happens instead is that their investment advisors will assure them that they are following their wishes, but they actually place the money into a higher risk fund.
Another way to mis sell an investment is to not be entirely truthful about it. For example, if advisors do not let their clients know the true risks involved in an investment, they are mis selling. Also, if they tell their clients that the possibility of their capital decreasing does not exist, they are misselling the investment.
People who cannot claim to have been deceived are those who were clearly informed that there is a risk of losing some, if not all, of the capital. If their advisors further informed them that the investments’ value had the potential to go up as well as down, are not victims of fraud. Sometimes, people who have lost money have accused their advisors of misselling, but this is not always necessarily the case.
People may be the victims of being sold an inappropriate product whether or not they have lost money. The fact that the investment was not the right one for that particular investor is enough to make this complaint. For example, an investor that was looking for a diversified portfolio but was urged to purchase stock in only one company would be able to make a claim that misselling had occurred. This particular investor wanted to diversity assets in order to balance risk, but placing the entire sum in one place certainly does not meet this goal. The fact that this investment has not lost money yet would not apply.
One example of a bank that has been found to be guilty of misselling their investments is Barclays. Barclays is an investment bank that sold two particular investment funds to 12,331 investors. What the authorities determined was that Barclays did not ensure that these funds were the right investments for each of these 12,331 people. They also determined that Barclays’s staff was not adequately trained on how to determine that their clients’ financial needs were being met with these investments.
Further, the authorities even objected to Barclays’s marketing materials. Their brochures were considered to be inadequate for clearly stating the risks these investments presented. They also were criticized for not implementing processes that would inform those in upper management that problems with the investments mis selling was arising. As a result, they could not address these issues in a timely manner.
The consequence for not being vigilant enough in their business dealings is the loss of a large sum of money. Barclays must return the money that was invested with them to their clients in the sum of ,081,169. They must also pay a fine of ,330,416. They have been working to regain the trust of the public again ever since.
Those who believe that they have been misled by their investment advisors have the ability to make a complaint. Those who have been placed into unsuitable investments and need to be compensated as the Barclays clients have been, can hire an attorney. The attorney will determine whether or not their clients have a case for PPI Claims, and will work to resolve the issue for them.
PPI mis selling occured regularly within the banking sector by advisors and brokers. You may have had PPI mis sold to you in the past ten years without ever being aware.
2 Reader Comments
Free PPI claims calculator said on April 12, 2012, 3:28 pm:
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