Mr. J contacted an independent financial adviser, mentioning a high-income bond (sometimes known as.

Mr. J contacted an independent financial adviser, mentioning a high-income bond (sometimes known as a ‘precipice’ bond) that he had seen advertised in the press. Mr. J and his wife wanted to invest a capital sum of approximately £300,000. The income they got from this capital would form their main source of future income, as they had little pension provision. The adviser offered a positive opinion of the bond and forwarded Mr. J an application form to complete. The adviser subsequently sent Mr. J a letter saying the transaction had been carried out on a ‘limited advice’ basis. Not long afterwards, Mr. J approached the adviser again, saying he was seeking a way to invest the proceeds of a maturing investment. The adviser suggested four possibilities, including another high-income bond – which Mr. J subsequently invested in. Again, the firm sent him a letter saying the transaction had been carried out on a ‘limited advice’ basis. The following year, concerned about poor returns from both of his bonds, Mr. J complained to the adviser’s firm. He said he had received poor advice and had never been warned of any risk attached to his investments. When the firm rejected the complaint, Mr. J came to us.

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