St. James's Place Wealth Management Plc · DRN-5610919

The complaint Mrs F is unhappy with advice she received from St. James's Place Wealth Management Plc (SJP) to invest into a property fund. What happened Mrs F opened an ISA which commenced on 1 April 2011. It was recommended that she invest into the ‘Deferred income portfolio’ due to her medium attitude to risk and objective which was explained as being able to take an income later. A total of £10,200 was invested across six funds. In July 2019 a fund switch took place, with 19.25% of the investment funds being switched to the Property Unit Trust Class L. Limited documentation has been provided from SJP in relation to the advice that led to this fund switch. On 14 November 2022 Mrs F met with an adviser again who provided a recommendation on 30 November 2022. The contact notes set out that Mrs F was happy with the funds she was currently invested in. And the recommendation set out that Mrs F wanted to invest an additional £10,000 to achieve a greater return on the monies than if it was left in cash. The recommendation provided was said to meet Mrs F’s objectives because: • She would be making use of her ISA allowance and have the flexibility to access the funds either via a tax-free lump sum or regular income. • The potential for growth over the medium term. • The funds would benefit from continual analysis. • She would benefit from annual reviews. Mrs F’s risk profile was set as being medium and a bespoke portfolio was recommended, the adviser selected eight funds to invest into equally. 12.5% of the deposit was invested into ‘Property’. Mrs F was in her mid 70’s at this time and retired. Mrs F raised a complaint with SJP, she said that she had wanted to sell her investments however part of the monies was invested into a Property fund that had been frozen. She said she wasn’t aware that there was a chance the fund would be suspended, had she known she wouldn’t have agreed to make the investment. I understand the fund is now being wound up and that Mrs F has received around 25% of her investment returned, in the sum of around £820. On 25 February 2025 SJP issued their final response, they didn’t uphold Mrs F’s complaint. In summary they said: • The illustration provided in 2022 explained the Property Fund held illiquid assets and so withdrawals might be delayed. • The terms and conditions of the ISA allow investments to be suspended in exceptional circumstances. • They explained the reason for the suspension of the Property Fund.

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Unhappy with the response Mrs F referred her complaint to this service for consideration. An investigator reviewed things and issued their assessment. They upheld Mrs F’s complaint, in summary they said that they didn’t disagree with SJP’s assessment of Mrs F’s risk profile, or the amount she ought to have kept in cash accounts. And they agreed that Mrs F had been made aware that the property fund could be suspended. But they said it wasn’t suitable for Mrs F to have been advised to make an investment into a fund that may become illiquid due to her age and all the reasons why she might need access to the money because of that. To resolve things the investigator suggested that SJP calculate what Mrs F’s investment would now be worth had the monies been invested across the other funds that were held within her ISA. And pay compensation in the sum of any loss calculated. In addition, they suggested SJP pay £150 compensation due to the inconvenience Mrs F had been caused in not being able to access the monies when she had wanted to. Mrs F thanked the investigator for the assessment, but SJP didn’t agree with it. They set out in summary: • The complaint had been referred out of time. • Mrs F had been told that the fund had been suspended in March 2020 – and then the suspension had been lifted in September 2020. But she still chose to make the further investment in 2022. The investigator explained that the complaint had been referred within six years of the event and so had been made in time. And they asked SJP to provide any further evidence that the suspension and risk of illiquidity was discussed with Mrs F for them to consider, but explained that just because Mrs F had knowledge that wouldn’t necessarily mean it was suitable to give her the advice that SJP had. SJP responded, they said had Mrs F expressed concern with the fund choice that would have been taken into account. She knew the illiquidity risks and so should take some responsibility for the investment decision made. They asked for an ombudsman to review the complaint. What I’ve decided – and why I’ve considered all the available evidence and arguments to decide what’s fair and reasonable in the circumstances of this complaint. Whilst I have considered everything that has been provided to this service, I don’t intend on commenting on each item. Instead, I will focus on what I have determined are the key aspects of the complaint. In particular what remains in dispute. When considering what’s fair and reasonable in the circumstances, I need to take account of relevant law and regulations, Regulator’s rules, guidance and standards and codes of practice, and what I consider to have been good industry practice at the time. This includes the Principles for Businesses (‘PRIN’) and the Conduct of Business Sourcebook (‘COBS’). Mrs F was advised to make an investment into SJP’s property fund initially during a fund switch in July 2019. And make a further investment when she added funds to her ISA in 2022. SJP have not argued that this advice was suitable for Mrs F. Rather, they have argued that Mrs F was aware of and understood the risk she was taking when investing monies into their property fund. They say that because of the fund illustration and the temporary suspension in 2020. And they set out that the terms of Mrs F’s ISA allow them to suspend funds under some circumstances.

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I’ve not been provided with any evidence of the advice given in 2019. I have therefore considered the circumstances described by Mrs F in 2011. At the time she was a little over 60 years old, married and a homemaker. She invested differently than her husband did because she said she may want to draw an income from the ISA in the future. Her husband was working and earning around £102,000 per year. Mr and Mrs F explained that Mr F was looking to retire in around two years’ time. So, by 2019 it’s likely Mrs F’s household income had dropped, and she was around 70 years old. I therefore don’t think it was suitable to advise Mrs F to invest 19.25% of her monies into a fund that she would not be able to withdraw her funds from if needed and which had the potential to become illiquid. SJP haven’t presented any arguments that challenge that view. It was their role as Mrs F’s advisers to assess Mrs F’s circumstances and suggest to her something suitable based on her aims and tolerance to risk. Mrs F trusted SJP to advise her to do something suitable. So, I can’t agree providing Mrs F with the fund information following their suggestion negates SJP’s responsibility in this case. A further investment was made into a property fund in 2022. SJP have argued that at this point the fund had been suspended temporarily and Mrs F had been made aware of the suspension. She had said she was happy with the asset distribution and so a further investment was suggested. Mrs F had aged by a further three years at this point and so closer to the chances of needing the income she had described, and there had been unrest in the property market which SJP were aware of. So, I don’t agree a further investment into the property fund was a suitable suggestion. When considering how to put things right I need to consider what would have happened, had Mrs F been given suitable advice. I can’t say specifically what suitable advice would have been in both 2019 and 2022. But, I think a fair resolution would be to conclude that it is most likely that the monies that were invested into the property fund would have been distributed evenly between the other funds Mrs F invested into in 2019 and then in 2022. For this reason, I am directing SJP to award redress on this basis. Putting things right To resolve this complaint, I direct SJP to award redress for the reasons explained above. I think this is a fair and reasonable way to compensate Mrs F for the investment loss she has suffered due to the unsuitable advice she received from SJP in 2019 and 2022. • Carry out a calculation to compare the performance of Mrs F’s property investments with that of the performance of the investment monies as if the monies had been invested in an even distribution between the other investment funds. From the date of the respective property investments to the date of my final decision. SJP should pay the difference between the fair value and the actual value. If the actual value is greater than the fair value, no compensation is payable. • Pay Mrs F £150 compensation to reflect the impact the unsuitable advice has caused her. Mrs F has been unable to withdraw funds she wanted to for a significant amount of time. • Provide the calculation details to Mrs F in a clear and simple format. Actual value This means the actual value of the property investments as at the date of my final decision. If at the date of my final decision the investments are illiquid it may be difficult to work out what the actual value is. For calculating compensation, SJP should establish an amount it’s

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willing to pay for the investments as a commercial value. It should then pay the sum agreed to Mrs F plus any costs and take ownership of the investments. If SJP is able to purchase the illiquid investments, then the price paid to purchase the holdings should be allowed for in the actual value (because it will have been paid to Mrs F for the purchase of the investments). If SJP is unable, or if there are any difficulties in buying Mrs F's illiquid investments, they should give the holdings a nil value for the purposes of calculating compensation. In this instance SJP may ask Mrs F to provide an undertaking to account to them for the net amount of any payment she may receive from the relevant holdings. That undertaking should allow for the effect of any tax and charges on the amount Mrs F may receive from the investments. SJP will have to meet the cost of drawing up any such undertaking. Fair value This is what the investments would have been worth at the date of my final decision had they produced a return in line with being invested in an even distribution between the other investment funds Mrs F was invested in at the time of each piece of advice. Any additional sum paid into the investment should be added to the fair value calculation from the point in time when it was actually paid in. This should be done taking account of the actual fund allocations at the time. Any withdrawal, income or other distributions paid out of the property funds should be deduced from the fair value calculation at the point it was actually paid so it ceases to accrue any return in the calculation from that point on. If there is a large number of regular payments, to keep calculations simpler SJP can total all those payments and deduct that figure at the end to determine the fair value instead of deducting periodically. If any distributions or income were automatically paid out into a portfolio and left uninvested, they must be deducted at the end to determine fair value, and not periodically. Interest The compensation resulting from this loss assessment must be paid to Mrs F within 28 days of my final decision. The calculation should be carried out as at the date of my final decision. Interest must be added to the compensation amount at the rate of 8% per year simple from the date of my final decision to the date of settlement if the compensation is not paid within 28 days. My final decision I uphold Mrs F’s complaint and direct St. James's Place Wealth Management Plc to pay redress as set out above. Under the rules of the Financial Ombudsman Service, I’m required to ask Mrs F to accept or reject my decision before 28 April 2026. Cassie Lauder Ombudsman

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