Investment Disputes: Advice, Platforms and Trading

Bad investment advice, platform failures, CFD/FX losses, SIPP-held investments and crypto. Your rights under FCA COBS, the FOS award limits and the FSCS backstop.

Financial Ombudsman Service (FOS) / FSCS for failed firms

4 sub-sectors covered

Investment complaints sit at the strict end of the FCA-regulated consumer-dispute space. The applicable rulebook is FCA COBS (the Conduct of Business sourcebook), with COBS 9 on suitability assessments at the centre of most advice complaints. The Financial Ombudsman Service is the consumer route, with the Financial Services Compensation Scheme as the backstop where the adviser or firm has failed.

Investment complaints are won on documents: the suitability report, the fact-find, the risk profile, and the contract notes. The FOS upholds a meaningful proportion of investment-advice complaints because the documentation often does not support the suitability conclusion the adviser reached. The complaint is rarely "the investment went down" (which is not in itself a ground for complaint); it is "the investment was not suitable for me on the documented facts the adviser had".

Key Legislation

Financial Services and Markets Act 2000 (esp. ss.21, 26, 27, 39, 213)
FCA COBS (esp. COBS 9 suitability, COBS 10 appropriateness, COBS 11 dealing, COBS 14 promotions, COBS 22 CFDs)
MiFID II (retained)
FCA PRIN 2A (Consumer Duty)
FCA DISP (esp. DISP 1.6.2R eight-week clock; DISP 2.8.2 time limits)
Limitation Act 1980 (s.5 contract, s.14A latent damage)

Complaint Route

Financial Ombudsman Service (FOS) / FSCS for failed firms

Always complain to the company directly first. Give them 8 weeks to respond. If unresolved, escalate to the relevant ombudsman or ADR scheme listed above. EvenStance guides you through every step.

The most common investment disputes

Bad investment advice. The FOS test for an unsuitable-advice complaint is set out in COBS 9. The adviser must have obtained necessary information about the consumer's knowledge and experience, financial situation, and investment objectives, and the recommended investment must have been appropriate in light of that information. Common upheld complaints: high-risk investments recommended to consumers with capacity for loss inconsistent with the risk; unregulated collective investment schemes (UCIS) recommended to retail clients in breach of FCA marketing restrictions; pension transfers from defined benefit schemes without a defensible suitability case. Time limits: six years from the act of advice, or three years from the date the consumer should reasonably have known, whichever expires later, under DISP 2.8.2.

Platform failures and outages. Investment platforms hold consumer assets on a custody basis. Disputes typically involve trading-platform outages preventing the consumer from buying or selling at an intended price, errors in order execution, account access failures, and dividend or corporate-action errors. Successful complaints often turn on whether the platform's terms genuinely entitle it to suspend trading without consumer redress, and on the FCA's COBS 11 rules on best execution. The FCA's PS22/4 reforms on platform exits (effective from October 2023) require platforms to allow exit on reasonable terms and to be transparent about the costs and timing of in-specie transfers.

CFD and FX losses. Contracts for difference and rolling spot FX are governed under the FCA's PROD product-governance rules and the COBS 22 retail restrictions on CFDs. The COBS 22 rules (in force from 1st August 2019) cap retail leverage at 30:1 for major currency pairs, ban incentivisation, require negative-balance protection, and require standardised risk warnings. Where a firm has offered retail clients access without these protections, the firm has breached the FCA rules and the consumer has a strong COBS 9 (suitability) or COBS 10 (appropriateness) case.

Crypto. The regulatory perimeter is narrow. Crypto derivatives are within the FCA's regulatory perimeter; direct crypto trading on most exchanges is not. The financial-promotion rules under section 21 of FSMA 2000 (extended to qualifying cryptoassets from 8th October 2023) apply to UK-targeted promotions. Where a crypto firm has made financial promotions to UK consumers without authorisation or an authorised approver, the financial promotion is unlawful and consumers may have private-rights remedies. Consumer recourse for losses on direct crypto trading is otherwise limited; FSCS does not generally apply, and FOS jurisdiction is narrow.

SIPP-based investments. Two parallel complaint routes. Against the SIPP operator for due-diligence failures on the underlying investment (the Berkeley Burke and Carey Pensions case lines). Against the recommending adviser for unsuitable advice. Both routes go through the firm first under DISP, then to FOS. SIPPs holding unregulated collective investment schemes or non-standard assets are the most common dispute area.

Mini-bonds and unregulated investments. The FCA's PS19/22 ban on the mass marketing of speculative illiquid securities (mini-bonds) to retail clients commenced 1st January 2020. Where consumers were sold mini-bonds before the ban, the financial-promotion rules under s.21 of FSMA 2000 and COBS 4 are the operative framework. Where the firm is no longer trading, FSCS is the backstop. The FSCS has paid out substantial sums for failed mini-bond schemes (London Capital & Finance, Blackmore Bond, etc.) under s.213 of FSMA 2000.

The first fob-off and the rebuttal that works

Investment firms' first responses cluster around three patterns. First, "the investment was suitable on the information available". The rebuttal is the documentary record. Request the full fact-find, the suitability report, the risk-profile questionnaire, and the contemporaneous notes via a Subject Access Request. Then check whether the recommended investment matches what the documents support. Where the documents show a consumer with a capacity-for-loss inconsistent with the recommended risk, the suitability case is in trouble for the firm.

Second, "you signed the disclosure documents". The rebuttal is that signatures on standard documents are not a defence against unsuitability. COBS 9 requires the firm to obtain the necessary information and make a suitable recommendation; the consumer's signature does not transfer that obligation back. The FOS regularly upholds complaints where the consumer signed standard documents but the underlying suitability case is not made out on the firm's own file.

Third, "the market went down; that is not our fault". The rebuttal is that the complaint is not "the market went down" but "the investment was not suitable for me even taking into account the risk of market falls". Where the recommended portfolio had a downside that exceeded the consumer's documented capacity for loss, the firm is liable for the loss caused by the unsuitable recommendation, not for general market movements.

Escalation path

For complaints against an FCA-regulated firm that is still trading: complaint to the firm under DISP, eight-week internal handling window under DISP 1.6.2R, FOS referral with a six-month time limit from the firm's final response. For complaints referred from 1st April 2026 about acts on or after 1st April 2019, the FOS maximum binding award is £455,000 (uplifted annually in line with CPI); for earlier acts, £205,000.

For complaints against a firm that has failed: the Financial Services Compensation Scheme under s.213 of FSMA 2000. Investment claims are protected up to £85,000 per person per failed firm. FSCS pays out where the firm is unable to pay and the consumer has a valid claim against it.

For unauthorised firms: the FCA's enforcement team handles unauthorised business reports. Section 26 of FSMA 2000 makes unauthorised contracts unenforceable against the consumer and provides a right to recover money paid under them. Section 27 of FSMA 2000 applies to agreements made through unauthorised intermediaries. For outright investment fraud, Action Fraud and the police are the routes.

For Appointed Representatives: the principal firm is liable for the AR's regulated conduct under s.39 of FSMA 2000. The FCA's PS22/11 reforms on AR oversight (effective from December 2022) strengthened the principal's responsibility.

What it costs and how long it takes

The FOS is free to consumers. The firm pays a case fee for each case that reaches investigation. FSCS is free. Investigation timeframes at the FOS for investment cases are typically four to twelve months from referral. Complex cases (SIPP, defined benefit pension transfer, mini-bond) can take eighteen months or more. FSCS payouts after firm failure are typically four to twelve months from the firm's declaration of default.

Court is the residual route for cases above the FOS or FSCS limits. Negligence claims run for six years from breach under s.5 of the Limitation Act 1980, with the s.14A latent-damage extension of three years from date of knowledge (fifteen-year longstop).

How EvenStance helps with investment disputes

Frank's investment-dispute flow drafts the formal complaint to the firm with the correct COBS reference (suitability under COBS 9, appropriateness under COBS 10, financial promotion under COBS 4 or 14, best execution under COBS 11), runs the eight-week DISP clock, and prepares the FOS submission with the regulatory grounds front-loaded. The Subject Access Request flow generates the SAR for the firm's full file, including the fact-find, suitability report, risk-profile questionnaire, and contemporaneous notes.

For SIPP-based investment disputes, the platform identifies the parallel routes against the SIPP operator and the recommending adviser, and tracks both clocks against the eight-week DISP framework.

Sub-sectors Covered

Investments - AdviceInvestments - CFD/FXInvestments - PlatformCrypto

Frequently Asked Questions

Can I claim for bad investment advice?

Yes. If an FCA-regulated adviser recommended an unsuitable investment, you can complain through their internal process and then the Financial Ombudsman Service. The right question is whether the investment was suitable on the documented facts the adviser had at the time of advice. Under COBS 9 the adviser had to take into account your knowledge, experience, financial situation and objectives. Where the documentation does not support the suitability conclusion, the FOS regularly upholds the complaint. Time limits under DISP 2.8.2: six years from the act of advice, or three years from the date you reasonably should have known, whichever expires later.

The investment firm has gone bust. What can I do?

If the firm was FCA-regulated, the Financial Services Compensation Scheme under s.213 of FSMA 2000 covers investment claims up to £85,000 per person per failed firm. You submit your claim with the contractual and advice documents, FSCS investigates the substantive claim against the firm, and pays out where it is satisfied the firm would have been liable.

Was my CFD broker offering me an unsuitable product?

The FCA's COBS 22 retail restrictions on CFDs have applied since 1st August 2019. The rules cap retail leverage at 30:1 for major currency pairs, ban incentivisation, require negative-balance protection, and require standardised risk warnings. Where the broker offered access without these protections to a retail client, the firm has breached the rules and the COBS 9 (suitability) or COBS 10 (appropriateness) case follows.

Is the FCA going to compensate me for a crypto loss?

In most cases, no. Direct crypto trading on most exchanges is outside the FCA's full conduct-of-business perimeter. Where a UK firm has made unauthorised financial promotions or run an unauthorised business in the FCA's regulated perimeter, FSMA 2000 sections 21 and 26 may give a private-rights remedy and the FCA may take enforcement action. For outright fraud, Action Fraud and the police are the routes.

What is the FOS award limit for an investment complaint?

For complaints referred to the FOS from 1st April 2026 about acts on or after 1st April 2019, the maximum binding award is £455,000. For complaints referred from the same date about acts before 1st April 2019, the limit is £205,000. The limits are uplifted annually in line with CPI. The FOS can recommend more than the cap but the recommendation above the cap is not binding.