THE Financial Ombudsman has awarded e2,000 in compensation to a Dundalk woman who was inadequately advised about investing her savings.
The Ombudsman found that the sales procedure adopted by the financial company was inadequate as it failed to adequately advise the woman regarding the risks associated with the investment in question.
The complainant met with an employee / representative of the company in May 2007 to discuss investment options as her SSIA scheme had come to an end and she was looking for a replacement savings facility.
Based on the advice received at this meeting, she invested an initial lump sum of e12,000 and a regular monthly premium of e200 in the BIL Special Bonus Investment Plan.
All contributions were invested in the Evergreen Fund, which does not offer a capital guarantee. She encashed this investment in late 2010, crystallising a loss of e3,700.
The company argued that the complainant was provided with a report which sets out the funds available to a growth investor and it was open to the woman to seek information concerning these funds.
The company also argued that she could have allocated her entire investment to a capital secure investment but chose not to do so. The woman was also allowed to cancel her policy within 30 days of the date on the covering letter accompanying policy documents.
The Financial Ombudsman noted in the ruling that by June 18, 2008 the complainant was on notice of the fact that her investment had fallen below the value of contributions made.
“Had the complainant taken some action...in June 2008 when she received her first annual statement, she would have mitigated the loss suffered and therefore I do not believe that the Complainant should be compensated in full...”.