Jersey regulator launches campaign against mis-selling

The Jersey Financial Services Commission (JFSC) has teamed up with the Personal Finance Society (PFS) to launch a public awareness campaign on investment mis-selling in response to increasing numbers of local investors losing their savings through high-risk investments.

Jersey regulator launches campaign against mis-selling

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The announcement follows the October 2016 collapse of JFSC-regulated Lumiere Wealth, an IFA that sold investment schemes linked to defunct Guernsey investment firm Providence Global.

The JFSC said that, in most cases, the islanders invested apparently without understanding or being appropriately advised of the potential dangers.

Adding that, while unauthorised advisers and scammers are a growing concern, in some instances these high-risk investments have been made via authorised financial advisers; often professionals who the investors knew and trusted.

The JFSC stressed that the majority of professional financial advisers on the island give appropriate and suitable advice which can be relied upon.

However, it is urging islanders to be aware of the risks associated with seeking higher returns and take responsibility for their investments.

Impossible to prevent every case

John Harris, JFSC director general, said: “Reducing the risk to local investors and protecting Jersey’s reputation are key responsibilities for the JFSC and we care passionately that Islanders understand the potential risks as well as the opportunities of all investments.

“It is impossible for us to prevent every single case of investment mis-selling that affects islanders, but we can raise awareness about the risks and ask investors to question whether an investment recommendation is actually in their best interests.

“As the responsibility for individual investment decisions ultimately rests with the investor, our intention is to provide Islanders with the guidance they need to protect their money.”

Personal Finance Society (PFS)

PFS, the professional body for the UK financial planning profession, is working in association with the JFSC on the campaign.

Keith Richards, chief executive of the PFS, said: “We are working in partnership with the JSFC on this key consumer awareness campaign to help people make better informed financial decisions. With interest rates so low, many investors feel under pressure to make their money work harder. But seeking higher returns can often increase the risk of loss.

“Coupled with a dramatic rise in sophisticated investment scams, it is essential for consumers to think carefully before committing to any investment opportunity and, where possible, seek professional financial advice.”