Victory for historic Quilter investors

The first investor, Mr B, had been advised between 2009 and 2011 to transfer out of his Zurich Pension into a Self-Invested Personal Pension (SIPP) fund which promised 12% returns and sold as a low to medium-risk investment. Mr B’s £65,000 investment never made any money, dwindled in value over a number of years and was ultimately valued at just £1.

Mr B had been advised by Paradigm, which was later acquired by Caerus and then by Quilter in 2017. After realising how much money he had lost, he made a complaint to Quilter in 2019. Quilter argued that the time window for complaints had closed, as outlined in a letter dated 2014, however the Financial Ombudsman (FOS), disagreed. FOS is the official body that settles disputes between financial businesses and their customers, and they said that there was no evidence the letter was ever sent, and that Mr B’s claim was within the allowed time limit. Mr B was awarded £160,000 compensation, plus interest and costs.

The other investor, Mr D, had received financial advice in 2006 from a company called Positive Solutions, which was later acquired by Intrinsic and then by Quilter in 2018. Mr D had invested a total of £176,000 in unregulated property development, Stirling Mortimer. The development was never completed and the fund was liquidated in 2016. Mr D complained to Quilter in 2018. Again, Quilter tried to argue that Mr D’s claim was outside the claim window and again FOS disagreed.

Both investors had made their complaints within three years of when they became aware of their investments’ poor performance, meaning the claim was valid. Quilter was ordered to pay Mr D £150,000 plus interest.

It is not the first time we have reported on Quilter and pension compensation cases. Over a number of years, they bought other failed Defined Benefit Pension Transfer businesses, including Prescient and Lighthouse, neither of which proved to be good decisions. Lighthouse has been linked to the British Steel Pension Scheme scandal.

Defined benefit pension schemes are a very solid and dependable source of income for retirement and there must be an extremely good reason to transfer from them into a riskier type of investment. Getting the right sort of advice is therefore crucial.

To protect customers, Government backed City watchdog, the Financial Conduct Authority (FCA) has strict rules for financial advisers to follow when advising on pension transfers. Amongst other regulatory obligations, advisers must ensure that any advice they give is suitable for the particular client’s circumstances.

A spokesperson for Quilter said:

“We are conscious that some legacy business included unsuitable advice surrounding unregulated collective investments schemes. Where we find any of this advice to be unsuitable, then we will uphold the case and award redress accordingly.

“We do have to consider the wider implications of the case being ‘out of time’, however we do of course accept and abide by an Ombudsman’s decision, should they disagree with our findings.”

Sarah Spruce, Head of Professional Negligence comments:

“These latest FOS decisions are important for investors and demonstrate the significance of the difference between when investors became aware of an issue with their investment and the date when they received the original financial advice.

We have helped many people who thought they were out of time for making a complaint and have also successfully claimed compensation on behalf of clients who had previously had claims rejected by FOS. If you are not sure about the time limits in your case, please get in touch with a member of TLW Solicitors’ financial mis-selling team.”