08 FEB 2021

How Do I Handle Being Mis-Sold a Financial Product

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Were you given advice that was either not suitable or downright bad while you were buying a financial product? You were basically mis-sold products, which is not good at all. According to the Financial Conduct Authority (FCA), any type of financial service needs to be sold to you in a clear and fair manner.

If any of the following things happened to you while you were purchasing a financial product, then you’ve pretty much experienced financial mis-selling:

  • Hidden charges and fees only come up when it’s too late for you to do anything about it
  • No risks were explained in conjunction with the financial product you were buying
  • The aforementioned bad advice, and/or something is unsuitable
  • There was discomfort during the sales process, and you were pretty much pressured into purchasing something you neither want nor need
  • You ended up with a product you don’t need after all because you did not get enough information

Payment Protection Insurance (PPI) is the most common example of this. It’s also known by other terms such as loan repayment insurance, credit insurance or credit protection insurance. The FCA found that an overwhelming number of PPI was mis-sold, and the refunds reached billions in total overall. 

Here are some other financial products that are usually mis-sold:

 

Endowments and Mortgages

This happens when you get advice that it would be best to self-certify (borrowing funds without proof of income). Additionally, you may get told that your best bet to borrow more funds is through overstating your income. Mortgages are generally mis-sold through not being told about any penalties or fees applicable upon advice to just switch lenders.

A possible mis-selling situation can also be found in getting penalties when you leave a fixed rate early after you were given advice to remortgage to a better deal.

 

Investment Products

Incorrect information as well as not being told about risks as well as no details on where your money will get invested count as a possible mis-sell. It’s also likely to have happened if, after you had a specific conversation with an advisor about what you need and how you feel about risks, the investment product you ended up buying doesn’t equate to that.

Advisors are supposed to be registered with the FCA. If they aren’t, it is in your best interest to take your business somewhere else.

 

Self-Invested Personal Pension (SIPP)

One of the top claims that the Financial Services Compensation Scheme (FSCS) got back in 2017 or 2018 involved advice about pensions. Most of it directly involved retirement savings being transferred out of an occupational scheme and into a SIPP instead, for making investments that are illiquid or risky.

 

Conclusion

Unfortunately, there are a lot of instances where financial services get sold in an unfair, misleading way, such as a mis-sold holiday. The Financial Conduct Authority (FCA) regulates this, and mis-selling should not happen at all. You can complain to the provider and, if needed, to the Financial Ombudsman Service (FOS) or Pensions Ombudsman.

Need help with mis-sold goods? Reach out to Consumer Reclaim today! We specialise in consumer mis-selling of goods, services, and insurance.

 

Consumer Reclaim Ltd is regulated by the Financial Conduct Authority in respect of regulated claims management activities, reference number: 835212. Registration is recorded at: https://register.fca.org.uk. Consumer Reclaim Ltd is registered in England and Wales, Company Registration number: 07223077. Information Commissioner Office number: ZA176000. VAT number: 144 4752 12