Bad advice in finance can have a devastating impact on people.
This is a campaign for real change.

Investment products

In the recent past, many of the main UK banks, including Lloyds, Barclays, RBS, HSBC and Santander were involved in mis-selling scandals involving investment products. Banks often failed to properly assess a consumer’s attitude to risk or capacity to withstand investment losses. Commission-based advisers in the banks pushed consumers into poor quality or risky investment products. Complex structured products were sold which underplayed the risks or exaggerated the potential returns.

For instance, in 2011, the UK regulator fined Barclays £7.7 million for advice failures related to the sale of two-high risk funds. The company was also required to pay out up to £60 million in compensation to the victims. The UK regulator found that Barclays failed to make sure that the funds it was selling were suitable for customers, and failed to adequately train staff to explain the risks involved in purchasing the funds.

In 2015, RBS Group offered compensation to up to 24,000 customers after it admitted to the widespread mis-selling of complex ‘structured products’ investments that were sold between 2009 and 2013. The investments involved were often complex, and RBS admitted that customers who took out the product may not have been able to fully understand it. Similarly, in 2016, Santander was fined £12.5m related to unsuitable investment advice it gave when selling investment products, such as structured investments and investment bonds, to retail consumers.

In order to reduce the risk of mis-selling, the UK’s Financial Conduct Authority decided in 2012 to ban investment advisers, including those who work in banks, from receiving commissions for recommending investment products. Some of the banks have now withdrawn from providing investment advice and are now focused on selling investment products online.