Has the FOS misled me?

[Terry142]

In 2007 my Father made an investment with an IFA. The IFA mis-sold the investment (unguaranteed Skandia bond) as they had critical flaws in there Risk Analysis Customer Profile Scoring Syestem - it is printed incorrectly! He should have been "Conservative" risk but incorrectly scored "Balanced" (The FSA will not tell us if they have investigated). A complaint was made to the FOS by myself on behalf of my 80 year old Father who made the investment (£80,000). To cut the chase, we protected the investment by my Father transferring all rights and ownership of the bond to me and my sister who are his only children (thus if he died, the bond would not "die" with him). The Ombudsman upheld the case, but in doing so, asked my sister and I to sign a form from them "to keep their records up-to-date".

 

It turns out 3 years on, this form put the complaint into all 3 names (against our primary wish - it was always my Father's complaint). The FOS said that now 3 people were involved, the current value of the bond would be used as the point of compensation. The problem is, I had worked the bond for 3 years and managed to increase the value by around £12,000 (when my father transferred it to my sister and I it was worth £58,000 - we had also contributed by coicidence around £13000 by private arrangement toward "buying" his bond from him). The FOS informed the IFA that they had to compensate for the current loss (now £10,000), plus interest at base rate ONLY, not the base rate +1% as shown in their fact sheets. I asked that my sister and I be removed form the complaint. The FOS advised that if we did that, my Father would not receive compensation. That was the final decision. If my sister and I DID NOT sign the decision, my Father would not receive his compensation. We were advised by the FOS we had to sign as we were part of the complaint, yet we only signed the original form as the FOS instructed us to do so, with no explanation given as to the ramifications!

 

My Father was now 83 and has waited long enough for the FOS decision. Although we signed, my sister and I made it clear we did not agree with the FOS making us part of the complaint. We complained to the Chief Ombudsman and the Independent Assessor. The Assessor acknowledges that no reason or note was given at the point that my Sister and I were told to sign, but that as we were now part of the complaint, the FOS were right to use the current value of the bond, although my Father had not owned it for 3 years, so we effectively lost the time and effort put into increasing the value as this was awarded to the IFA so they did not have to pay compensation based on the £58,000 bond value when it was transferred.

 

To add insult, we then argued with the FOS for 8 months as to why the +1% was not used on the base rate. There were no reasons given, but it turns out the IFA's insureres DID PAY the extra 1%, according to the FOS, without being instructed to do so!! (WHY)??? Good news for my Father, but my sister and I lost our £12000 made on the bond as it was awarded to the IFA as a current value of my Father's Bond, even though he hadn't owned it for 3 years. The FOS stated they assumed we would come to a suitable "arrangement" with my Father!

 

Our MP is now involved but has been fobbed off with the FOS refusing to answer any of my concerns. We are hoping to take this to the Treasury Select Comittee. I cannot afford to go to court. Is there anything else we can do? Please advise.....

 

By the way, the IFA kept their £6000 commission and management fee...... The FOS said they could as it was a Private Arrangement between the IFA and Skandia - but we couldn't with my Father (despite the FOS acknowledging the evidence that we had contributed £13,000)!

Edited July 17, 2012 by Terry142