Mis-sold pensions and investment scams are on the rise, with an increasing number of con-artists and bad advisors encouraging savers to move their retirement funds into high risk, volatile or downright unethical investments. So how do you spot one of these unprofessional scammers? Here are just a few signs you might be dealing with a bad advisor:
If you’re contacted by an independent financial advisor (IFA) by phone and the call is completely unsolicited, alarm bells should ring. Responsible IFAs never use this approach to get clients and so if someone does approach you in this way, we’d recommend that you refrain from passing on any details and hang up.
Most people who turn to a financial advisor do so because they’re seeking guidance from someone with a more thorough financial knowledge than they have themselves.
Chances are, you trust your advisor to point you in the direction of the most rewarding products and help you make the right decision. However, far too many IFAs pressure their clients into transferring their savings into pensions or investments that aren’t as low-risk or profitable as promised.
When making big financial decisions, it’s crucial that your health and medical history is taken into consideration. For example, if you were to purchase an annuity without informing the annuity provider of any medical conditions, there’s a risk you may be sold an unsuitable product.
For this reason, it’s vital that your financial advisor asks you about your health records before recommending a particular product. If they don’t request this information or they fail to pay attention to any details you give them, this could be considered financial mis-selling.
While you don’t need to be a pensions or investments expert in order to take out a particular financial product, you’ll need to have a good understanding about what you’re signing up for. It’s your IFA’s responsibility to explain the terms, conditions and risks to you.
If your IFA fails to inform you of the product’s small print, this could be an example of financial mis-selling. They should highlight the most important points and explain them to you.
If your IFA encourages you to pour your savings into a particular pension or investment while promising ‘low risk’ and ‘guaranteed’ returns, this could be a sign that they’re a dishonest advisor.
It’s very rare that an investment is low risk while also being highly profitable, so a responsible IFA will always be honest and upfront about the risks involved from the start. They’ll also be truthful about the amount of money you can expect to make. If it sounds too good to be true, it probably is.
If you’re already working with an IFA and you’re concerned they’re a bad advisor, don’t panic. Even if you’ve already parted with some of your savings, we may be able to help.
Here at Pension Justice, we specialise in fighting for compensation for victims of bad advisors and pension mis-selling, so you can rest assured you’re in the right hands when you contact us.
To find out how we can help you, please get in touch with our team.