Warning for any persons who may be encouraged into making an untrue or unsubstantiated complaint in order to seek compensation with regard to a Mortgage Endowment, Split Capital Trust or any other financial product.

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There is an increasing drive by various sectors of the media and the Consumers' Association to encourage people to seek "compensation" by making complaints against Financial Advisers.

Where any client has been given false information by a financial adviser then this may be the appropriate course of action and of course genuine mistakes or errors should be rectified.

Unfortunately too little emphasis is being placed by the media and the Consumers Association on the fundamental legal requirement for ALL complaints to be WHOLLY genuine and based ONLY on the true facts .

The impression may have been given that complaints can be created to a standard formula irrespective of the true facts of the case and it would be easy to receive the false impression that making such a complaint is a legally  acceptable course of action. 

To encourage anyone to take action which may be illegal is irresponsible (at the very least) and those who wish to make a complaint should fully understand their legal position, in order to avoid falling into one or both of the following categories:

      1. ATTEMPTED DECEPTION - Criminal Act - The Police Will Be Told.

      Attempting (or even the act of inducing someone to attempt) to Obtain money (e.g. compensation or rectification of previous status) from a Financial Adviser by making statements (including those created via a complaint generating website or other such media), knowing these statements to be untrue, is Attempted Deception and as such is a Criminal Offence. Any claim made against a Financial Adviser that is false may require the Adviser to report the complainant to the Police, so that the attempted deception may be investigated with a view towards possible prosecution.



       2. LIBEL. - Civil Act - Do not risk being sued for Libel.

      A defamatory WRITTEN comment or statement made to a third party (e.g. by a Complainant to the media or Financial Ombudsman Service about a Financial Adviser) which might harm, damage or impugn the reputation or financial standing of the Financial Adviser may be Libellous. Such written comments or statements may include those generated by use of complaint generating websites or other such media. Any statement of this nature made by a complainant may be LIBEL (whether or not the complainant knew the statements to be false).

"But remember - there is no automatic compensation just because you may be disappointed with the way your endowment policy is currently performing. Endowments are linked to long-term investments - which can go down as well as up."

These are the words of the Financial Ombudsman Service

"Although some customers say that the firm should meet any shortfall, or guarantee their policy will pay off the mortgage (often with a lump sum on top), we hardly ever agree to this. When these policies were sold, customers were usually given written information by the firm that explained there was no guarantee that the policy would make enough to pay off the loan. So a customer's recollection of the discussion with the firm's representative is unlikely to be enough for us to require the firm to make up any such shortfall."

"We do not have power to award extra compensation in order to 'punish' the firm."

These are the words of Sir Howard Davies - Chairman of the FSA HERE 

AND the FSA Press Officer, Rob McIvor HERE

Financial advisers may check your claims history using CUE and supply details of any spurious claims made to their database: 

 

   CUE is a central database of motor and household incidents reported to insurance companies, which may or may not give rise to a claim. Recently the list of databases has been increased to include Personal Accident claims and Life Assurance. 

Information about CUE is available to members of the public and people within the insurance industry (who can register their special interest and join to share information).

Insurers subscribing to the CUE database are members of Insurance Database Services Limited, a company setup by insurers to enable data to be shared between them.
  

This warning is not intended to dissuade anyone from making a genuine complaint which can be substantiated by fact (documentation) etc. with regard to the sale of a financial product.  This warning is intended to further the cause of true justice for all under the law of the land. It is a reminder that claiming is not an automatic right to compensation despite the impression which may be given by the press and consumer groups. The making of false compensation claims could put a Financial Adviser out of business and this is a very serious matter under the law. You are fully responsible for any statements that you make, even if encouraged by others, and you should take great care to ensure that your statements are wholly true to the facts of your case.