In its annual review for the year, the UK’s ombudsman also reported a 47.5% increase in grievances about IFAs where the event being complained about happened over 15 years ago.
These cases rose to 307 from 271 in 2017/18 and comprised 16% of all complaints made about an IFA.
The ombudsman service said that it resolved 1,125 complaints about IFAs for an uphold rate of 39%.
The product that generated the most criticism of IFAs in 2018/19 was Sipps (232), where the ombudsman was able to uphold 62% of cases.
Portfolio management (97) and occupational pension transfers (95) made up the rest of the top three.
Table 1: Uphold rate for top five most complained about products in complaints against IFAs
|Occupational pension transfers||95||47%|
|Isas (not cash)||67||37%|
There were 678 complaints resolved about sales and advice in regard to IFAs, which was an uphold rate of 41%.
Administration criticisms came second with 396 complaints resolved and a uphold rate of 35%.
Table 2: Uphold rate for different complaint types against IFAs
|Complaint type||Complaints resolved||Upheld|
|Sales and advice||678||41%|
Investments and pensions
The FOS said it received 15,606 complaints investments and pensions in 2018/2019, which was 24% higher than last year.
Some 48% of the complaints in this section were about pensions, with packaged investment products (18%) and whole-of-life policies and savings endowments (12%) made up the top three.
Table 3 – What the new investments and pensions complaints were about
|Packaged investment products||19%||18%|
|Whole-of-life policies and savings endowments||12%||12%|
|Portfolio and fund management||6%||5%|
|Other general investment||1%||<1%|
FOS said in the report: “Pension transfers are high on regulators’ and financial advisers’ agendas.
“We’ve illustrated the things we consider when looking at complaints, but some transfers are still putting people’s retirement savings at risk.
“We’re seeing the results of poor investment advice too – with people advised to invest in risky funds, or in schemes that turned out to be scams or fraudulent.”
Overall, in 2018/2019, the FOS received 388,392 new complaints (investments and pensions made up 4%).