My interest in consumer protection (and self-protection), which is what got the No Monkey Business project started, was fed with three items in the last few days. They have aggravated my frustration that people who should know better are still not framing the public policy issues properly.
read more Commentary by Stuart FowlerConsumer complaints about investments have nearly doubled in the past year, according to the Financial Ombudsman Service’s annual review. Overall investment and pension complaints (now including mortgage endowment cases) jumped to 22,265 from 12,787 in 2007/08. Commenting on the report, Citywire’s ‘New Model Adviser’ forum singled out that ‘while the ombudsman recognised under performance of investments was a factor in some of these complaints, it said poor stock market conditions had exposed poor advice. In particular it identified a trend in complaints where financial advisers had not sufficiently considered clients’ tolerance to risk.’
read more Commentary by Stuart FowlerIn today’s Sunday Times, Money editor Kathryn Cooper devotes her ‘Cooper on Cash’ column to the high street banks’ sales strategy of moving low-risk investors, including the elderly, out of low-yielding savings products into higher-yielding investment products that expose them to risk of loss of capital. Several of my recent items refer to this. She wants the FSA to ask itself whether it is enough to look at documentary evidence of the sales process ‘rather than casting its eye over the banks’ entire business strategies: is it right that pensioners should be moved en masse into corporate bonds and equities in their search for income?’.
read more Commentary by Stuart FowlerThe Sunday Times story, Lloyds bank staff ‘puts frighteners’ on debtors, sourced from undercover reporting, looks like further evidence of banks creating perverse incentives that have the entirely predictable effect of causing staff to treat customers badly, breaching either banking practice (as here) or (in savings and investment products) FSA regulations.
read more Commentary by Stuart FowlerI had not immediately spotted that HBOS ‘whistleblower’ Paul Moore, sacked head of Group Risk, in his written evidence to the Treasury select committee had specifically accused his employers of encouraging the promotion of corporate bond funds as alternatives to deposits without due regard to suitability. I am currently dealing pro bono with a complaint [...]
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