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Use the Financial Services Complaints System at First Sign

28 November 2012

Use the Financial Services Complaints System at First Sign of Trouble

New investments made over the last six months into failed Ross Asset Management might have been saved if existing investors had immediately made a complaint when they first became concerned about the security of their money.

“After the initial complaints had been received, we became aware that some investors had been concerned some months earlier about their Ross Asset Management investments, but had not immediately used the independent external dispute resolution scheme available to them,” Financial Services Complaints Limited (FSCL) chief executive Susan Taylor said.

FSCL is the dispute resolution scheme on behalf of Ross Asset Management. FSCL alerted the Financial Markets Authority as soon as it became aware of problems within Ross Asset Management.

“The financial services regulations, which came into force in December 2010, require all businesses in the financial services market to be part of an external dispute resolution scheme. These compliance regulations were introduced to help identify and resolve problems arising with investments”.

Ms Taylor said that the moment people who have concerns or problems with their financial adviser or investment manager, they should complain to the adviser’s or manager’s dispute resolution scheme, such as FSCL.

“The sooner a complaint is received, the sooner action can be taken. If the scheme sees that a systemic issue exists, the regulatory authorities can be alerted and the appropriate action taken, as has been the case with Ross Asset Management.

Ms Taylor said further lessons to be learned so far are:

• Select your fund manager with care. Check to see that the manager is audited or otherwise accountable. Be wary of secret systems or a reluctance to disclose past performance.

• Look into the size of the operation. One man fund managers will fail if the man/woman fails, whether through temptation or ill health. A professional management team with mutual oversight and clear succession is far preferable.

• Insist that the investments be in your name, and able to be seen on the public register of holders. Sometimes a fund manager will use a nominee company to aggregate interests. It is preferable that any nominee be independent of the manager.



Financial Services Complaints Ltd (FSCL) is an approved dispute resolution scheme under the Financial Service Providers (Registration and Dispute Resolution) Act 2008. FSCL investigates and resolves consumer complaints made against any of its 5,000 participants, including financial advisers, insurance advisers, finance companies, insurance companies, credit unions, trustee companies and card issuers.

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