A 74-year-old IFA has put his retirement plans on hold to contest a £250,000 mis-selling case levelled by a claims management company (CMC) - relating to advice given almost a quarter of a century ago.
In 1989, Philip Griffin, an IFA at Philip Griffin and Associates, transferred two clients into personal pensions from the Cleveland Potash scheme, due to fears the company was about to go out of business.
Though the company did not close, the new pensions with Scottish Widows achieved "significant growth", Griffin said.
But in October, he received a complaint from Money and Me Claims alleging mis-selling on behalf of the clients, as well as a number of other allegations.
"[Money and Me] made a series of complaints that were ludicrous," Griffin said. "One of the claims was for an ISA I'd never seen; another for an ISA that made 134% over six years."
The clients signed permission forms allowing Money and Me Claims to pursue Griffin.
"I thought these guys were friends," Griffin said. "They came to me, and even though I don't really do that kind of business, I did it as a favour."
After an internal investigation, the firm replied to Money and Me Claims, saying: "[we are] astonished by your proven ignorance with regard to financial products.
"I am astounded at your lack of proper research and the flimsy-to-non-existent evidence upon which you make your spurious claims on behalf of your client."
The case has now been referred to the Financial Ombudsman Service.
Griffin was due to retire in March, but will now continue until December in order to fight the action.
"We'd already put in an application to stop trading before RDR," he said. "But we've been in business for 34 years and we've never had a complaint."
"IFAs are under attack: [similar cases] will kill most people's businesses. You have to prove your innocence; they don't have to prove your guilt."
Griffin's position was highlighted in a recent meeting between PanaceaIFA CEO Derek Bradley and Highclere Financial Services adviser Alan Lakey, and senior figures at the Ministry of Justice, the government body that regulates the claims industry. They were said to be "appalled" at the case, Lakey said.
Money and Me Claims director Brian McLean, previously an FSA-registered individual at Future Independent Financial Advice, said: "Mr Griffin is more than happy to submit a complaint to the company, and if they thought my actions were inappropriate they would get a response," he said. "We are yet to receive a complaint."
He added he was "absolutely" confident the company, which takes a 15% fee from any compensation, would win the case against Griffin.
"We only submit complaints if there is justification," he said. "[Our last victory] was £112,000, the one before that was £167,000. We have never lost a complaint for an investment or a pension."
|Comment||Retiring IFA pursued by claims firm over 23-year-old case|
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