Ombudsman's Arch Cru decision overturned

Why the FOS does this? Or why it determines the turnover at the date of the complaint rather than the date advice was given?

Never had an answer to that one, not has the FOS explained what empowers it to ignore SI 2326 or the 15 year long-stop.

A strange beast is the FOS, and unappealable with it, most of the time.

makes me ever so slightly uneasy? I'm sure he is a nice guy, I actually met him once, but there is just something....

Now correct me if I am wrong, but this has been overturned on a technicality - the complainant wasn't eligible to complain to FOS.

So just how will this 'improve the chances of other advisers who invested their clients in the Arch Cru funds defending themselves successfully against complaints?'

It seems to me that the flaw in the way the firm handled this complaint was by not knowing the complainant was ineligible, not all that guff about focusing on the advice it (the firm) provided.

Once a lawyer, always a lawyer.

More 'shambolic, clueless, after the event, he said she said, sponging, time wasting, spurious and mind boggling bureaucracy' from the unnecessary and ridiculous compensatory, pseudo legal, regulatory bodies that should be closed with immediate effect! What a complete waste of time and money for all concerned.

Spot on, let's attack the weak link and hope they dont fight back-if they do we'll think of something else to cover our stupid back sides.

Dont go after the criminal, too much overcrowding in the prisons.

Who can we nobble next?

So Mr Fatchett has (on a technicality) over turned the FOS decision and has turned the focus on the marketing of the fund.

As we have read Cru is entering liquidation with debts probably exceeding £3m, so where does that leave the innocent client?

OK the adviser has got away with it, but this will reflect badly on the industry as a whole.

Mr Fatchett has stated that there is likely to be an avalanche of complaints and no doubt this case will have the advisers beating to his door in the hope of getting them off their incompetence.

Whilst I cannot see the precedent of a case being ruled outside of jurisdiction helping advisers defend against FOS cases, I wonder whether a succession of jurisdictionally valid upheld FOS complaints might help this particular client (and presumably others outside of FOS jurisdiction) in the courts.

Whilst the FOS apparently makes some unusual decisions, it is nonetheless an august body (and I must admit in my experience staffed by very helpful individuals - your mileage may vary), so presumably it's decisions would be considered at least partially precedential by the courts?

I am very glad to hear that Mr F has managed to get his client off on a technicality, however this doesn’t address the real problem, which is the client was still sold an investment which was probably not suitable for them or one they and their IFA didn’t understand, praise be that they cannot afford to pursue recompense against their advisers for this wrongdoing, that’s real justice and defiantly needs to be reach the main headlines of this noble institution.

What I find amazing in all this coverage is the lack of focus on the real people who seem to be needing to explain their actions and decisions, for once the blame does not lie with Mr Maguire or Capita who very wrongly seem to be the public scape goats for media attention, it lies with the offshore investment companies managed by ARCH and listed on the Channel Island Stock Exchange into which all the investors money was placed.

When are Citywire going to place ARCH truly in the spotlight and maybe they could start with the following questions?

When did they become aware there was a liquidity issue in the portfolios? As previously this was reported as the day before suspension, surely they must have known prior to this otherwise that would imply a lack of management control or understanding.

When did their Investment committee become concerned about the investments they were placing clients monies into and who was on this committee which was selecting investments?

How did they manage conflicts of interest between managing funds in two regulatory environments one of which nobody seemed to know anything about i.e. the channel islands and the UK and if the person responsible for the UK fund was investing into the channel island without know what was being invested in, which they would have to not fall foul of trading laws, why were they investing money as no sane institutional investor would place money into a fund he could not get a look through on?

How much did they really take in fees, after all they seemed to become a highly profitable company very quickly after taking over the management of the fund range, is this one reason why everyone has lost so much?

When are citywire the champions of IFAs actually going to start pointing the finger at the right people and asking some serious questions about the management of these investments of the people who really managed them as we all know that this was never Mr Maguire.

What about Bordeaux Services (the actual administrator responsible for all this mess)

What about winterflood securities the market makers, how involved were they in creating a market for these products and who were the other buyers which allowed the price to be maintained during the 2008 crash?

What about HSBC and Bank of New York Mellon who were responsible as custodians of clients monies?

When will the regulator of these investments (not the FSA) but the GFSC actually make a press statement detailing what is happening and who is being investigated

Come on Daniel, let’s have some real investigative journalism and bring some of the professional funds managers who really managed this investment to account for this

I am glad the FOS have not been able to enforce something illegally, but I would be dissapointed if the complainant does not seek to pursue this in the courts or at least consider it. I have no knowledge of the case and no opinion as to the advice given my the firm, but the whole idea of the lgeal system for me is to be proved innocent in court as much as guilty. We do not have "not proven" option, which is the situation this is now being left in it would appear by the failure of the FOS to get the procedure right.

As "The client" said, I'd like to see Citywire dig deeper and pursue the issue of where true fault lies as the individual advice issues are actually a side show which detracts from the potential frauds which deeper in teh mess which could mean ALL claiments get things sorted out rather than each have to pursue the individual who advised them who may have been equally misled by certain people.

1) It is about time the regulatory bodies were held to account as it should smarten them up and hopefully make them check what they are doing is in fact correct.

2) The client - You have perhaps without realising it hit the nail on the head with private equity / alternative investments. The main issue is liquidity and and so market value. Any valuer be it an actuary, property valuer or market maker can place a value or price on an asset but without liquidity to test that placed value it means very little.

I am a sizeable investor in Arch. We were advised by an IFA who assured about the low risk "almost" cash nature of the investments. Everything was asset backed etc etc etc.

The original ruling by the FOS has not been changed, only a technicalitity in this case.

My IFA told me when Regultory Legal was formed that they would be fighting for the investor. This action proves this group is only after one thing. Protecting the IFA's involved in this completely disgusting saga.

Everyone is blaming everyone else but the fact is the IFA's, Arch, Cru and Capita are all to blame.

Regulatory Legal are incorrect about one thing. I shall be taking my IFA to court, regardless of cost so hiding behind the "you cant afford to take us to court" defense will not work.

I hope you guys have git deep pockets to cover your legal costs.

I too have considerable funds in Arch - probably on the recommendation of the same IFA who advised you Investor. Everything you report sounds very familiar. Have you made a complaint against your IFA and will you then go to the FOS or are you planning to take legal action without going through those hoops. I am wondering what my next course of action should be and it would be helpful to compare notes.

Does anyone have any faith that Capita will be forced to compensate investors or is our only hope of compensation through pursuing our IFAs individually?

Another Investor. I would rather not discuss much on here but I am preparing my case. The FOS seems like the place to take the case assuming it is valid otherwise I will go straight to the courts.

It would be good to compare notes.

I think the IFA's, Capita, Cru and Arch will all blame each other for as long as possible. I think our complaint should be against the IFA. They sold us this "cash plus" product. If they want to mitigate their losses by going after Arch, Cru, the FSA, Capita, whoever else they can think of then fine. Thats their business.

I have every sympathy for anyone involved with Arch Cru at "private investor" level !! That is the poor clients that are in these funds and the IFAs that were provided these funds to recommend in the first place.

Dont forget that IFAs would have recommended these funds in good faith, with the relevant research and with their client very much in mind. An IFA would earn the same income from these recommendations as they would in any other funds- so there can have be no bias towards them.

No IFA could have forseen what is an institutional failure !! There are large institutions that are at fault here and need to carry the can to compensate clients and put them back into the position they were in at investment outset - even if some of them have to go bust !! Tough - due dilligence should have been completed before allowing the funds into the public domain. Why should clients and IFAs that believed their hype suffer any more ??

Lets hope the FOS /FAS have the guts to stand up to them - and not take the easy option of attacking an individual. I very much doubt it tho !!

I have made a complaint to my IFA but really only in the belief that this is the first part of a process. I anticipate taking my complaint onto the FOS probably sometime next month.

It would be good to have a converstion off line about this.

Also a sizeable investor. Complaint already with the FOS. Very happy to share notes if anyone wants to post an email address.

Hi

I would be very interested to share notes and information or even expenses with anyone else who was recommended these funds by their IFA as cautious and safe,

I had 90k invested and have no idea how much I may get back.

I am in East Kent and am very interested in pursuing this matter, but its hard on your own.

anorak33@hotmail.com

I too have filed a complaint with the FOS regarding the low to medium risk savings investment I embarked on in April 2008. I invested most of mine and my late husbands life savings and trust in to it, to get a modest monthly income and to hopefully build a moderate gain over the coming years for my children. £180,000.

I am now living in a state of anxiety and regret , having had no income from the fund since september 2009 and have no idea how much money will be returned.

Surely there has to be a compensatory fund insurance for this dire situation and if not the goverment or the FSA has to do something about it?

We all need to pull together and lobby parliament or something. I see that four people in Cleveland have reported it to the Police.

Has anyone received a satisfactory outcome from the FOS against their IFA in circumstances where Arch Cru was sold as a Cautious Investment? I am facing a considerable loss of money which I can ill afford from this so-called cautious investment.