The Financial Ombudsman Service (FOS) has reported a relatively low level of complaints against Independent Financial Advisers (IFAs) in the last year. Its 2018/19 Annual Review showed that only one in 200 complaints received by the ombudsman was about financial advice, with many of these relating to pensions.
The FOS received a total of 388,392 complaints in the last year. Most related to payment protection insurance and consumer credit transactions and only 1,915 were about IFAs. Just 4% of the total complaints concerned pensions and investments, with many of these directed at providers rather than advisers.
Of complaints directed at IFAs, self-invested personal pensions (Sipps) topped the list. The FOS resolved 232 complaints about Sipps, with more than six out of ten being upheld. The ombudsman also handled nearly 100 complaints about portfolio management by IFAs and 95 occupational transfer disputes.
While grievances about advice are low in comparison with other financial providers and products, the FOS reports that complaints about investment and pensions are at their highest level in five years.
Caroline Wayman, chief ombudsman said: “Decisions about pensions are some of the most difficult choices people make, and it’s important that consumers understand the risks involved when investing their pension pot.”
James Burgoyne, Director – Claims & Technical, Brunel Professions welcomed the figures, but warns against complacency. “The relatively low level of complaints about IFAs demonstrates the overall high level of advice provided by IFAs in the UK. However, advisers must stay on top of their client files and risk management as insurers will only offer their best professional indemnity rates to IFAs with exemplary claims records.”
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