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Jersey Consumer Council

Monthly Archives: July 2018

Looking to make an investment? Taking Financial Advice?

July 10, 2018 Banking, Budget No Comments

Remember it’s your money.

Never be afraid or embarrassed to ask questions or complain.

Don’t be too trusting, be wary of promises of a high rate of return with apparently little or no risk. All investments carry some degree of risk. Greater returns mean greater risk i.e. potential to lose some or all of the money you have invested.

  1. Double check everything, and don’t feel pressured into making an investment. Ensure you are given enough time to read through the product documentation and consider your options.
  2. Ask the independent financial adviser IFA [who should be registered with the Jersey Financial Services Commission {JFSC}] to explain in your language about their investment options and the risks. Licensed advisers are required to fully assess your attitude to risk, capacity for loss and ensure solutions are suitable. Ask for evidence of these key points.
  3. Do not sign any investment/product agreements that you do not fully understand. Always read the small print and any supplementary documentation. There may be hidden terms and conditions. Take the paperwork away and read it in your own time. If you don’t understand something ask for help.
  4. Consider spreading the risk between investments; Avoid ‘putting all your eggs in one basket’ – splitting your money between a few investments could help to reduce potential losses
  5. Know exactly what you want; duration of investment, do you need access to any of the money during the lifetime of the investment. How could this be changed by an unexpected change in your circumstances? Are there any penalties for withdrawing your money early?
  6.  Ask the IFA to explain how their recommendations meet your purpose; if what they say doesn’t match what they have provided in writing, be wary.
  7. Challenge the information, ask lots of questions. Make sure you fully understand the proposed investment and how much you could potentially lose. Only invest if you are completely informed, know the risks and how returns are generated.
  8. Do your research. Is the IFA licenced by the JFSC? What’s their feedback like – can anyone recommend them? Always research the person and the company selling you the investment, even if you know them personally and believe them to be trustworthy. You may have developed a good relationship but regard this as a business transaction and always ask yourself whether they are acting in your best interests – not their own
  9. Beware of putting money into “can’t miss”, “once in a lifetime” and “guaranteed return” opportunities or investments in which your adviser claims to have already invested their own money.
  10. Is there a choice of investments on offer or is your adviser just proposing a single product? And be wary if you are you being invited to cash in an existing investment such as your pension.
  11. Consider what compensation may or may not be available should the investment fail or the company selling it become insolvent. Jersey does not have an investor compensation scheme. What would a total loss scenario mean for you?
  12. Never be rushed; always be aware of pushy sales tactics. A professional adviser should never pressure you into making an immediate decision. If you are not given enough time, steer clear.
  13. Reflect, research and take advice. Consider talking to family or a third-party expert before you proceed. Perhaps have someone present when you meet with your adviser, particularly if you do not consider yourself an experienced investor
  14. Do not be fooled by cleverly worded marketing material on websites and in brochures – it could be misleading.
  15. When considering ‘alternative investments’ (e.g. wine, coins, stamps) rather than traditional financial services products, always do your research and understand the associated risks. These products, and usually the companies that sell or advise on them, are not regulated by the Jersey Financial Services Commission
  16. If you do invest, make sure you monitor the investment and ask for regular updates

You are the client – ask questions and make sure you get the answers so you are fully comfortable with your decision; how long will you be tied in for? Could you lose all your money?


When your bank writes to you.

July 6, 2018 Banking No Comments

If your bank writes to you requesting action on your behalf, here are our recommendations;

  • Do not ignore the request; if you are concerned that it may be a fraudulent letter contact your bank directly and ask. But be advised that potentially NO response from you can ultimately result in your account being closed.
  • Once you are sure that the bank contact is genuine follow the instructions or contact the bank if you are unable to provide the requested information by the deadline, explain the situation and ask for assistance as necessary. If this does not work, complain to the bank, then contact the Channel Islands Financial Services Ombudsman for guidance;

Channel Islands Financial Ombudsman (CIFO)
P O Box 114
Jersey, Channel Islands
JE4 9QG

01534 748610

enquiries@ci-fo.org

When responding to your bank’s requests for information – keep copies of your letters, notes of conversations, dates and bank responses.

  • Remember that a bank will never contact you by phone, email or letter to you to ask for your account passwords or your PIN number. If you get a call or email ‘out of the blue’ do not assume the telephone number or the email address, the caller may provide you to contact your bank is in fact your bank’s.  The safest approach is for you to call your bank back on their general number (shown on the back of your debit or credit cards or on your statements).  The bank’s call centre staff can transfer you to the appropriate bank department to resolve the matter.
  • Ensure the bank has your up-to-date address and contact details so that you do not miss any important correspondence.

Other banks can be understandably hesitant to open  a new account for you if they know your account at another bank has been closed.

Having your current account closed creates difficulties, for example with missed direct debits. Be mindful of course when setting up any new account to be vigilant that all your regular payments are set up and are not disrupted.

If your bank wants to close your account, they should give you sufficient time to make alternative arrangements. Be sure to ask for an extension, if you need more time.