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Barclays bank ordered to pay £112,000 in compensation

Barclays bank has been ordered to pay £112,000 in compensation to a retired couple who invested £200,000 into the Aviva Global Balanced Income Fund on the advice of Barclays bank. Within 18 months the investment had fallen to a value of £88,000 and the Financial Ombudsman Service upheld the complaint of the McCartneys and Barclays bank was ordered to repay the above compensation figure.

The situation comes down to the fact that the McCartneys had apparently requested a balanced investment strategy although the actual investment made was into a fund which was 60% invested in shares and 40% invested in fixed interest securities. In the eyes of the Financial Ombudsman this did not reflect a balanced approach to investment and as such the complaint was upheld for this reason. When the McCartneys initially contacted Barclays bank their complaint was dismissed at which point they went to the authorities. Unfortunately Barclays bank has yet to respond to the ruling or repay the compensation figure stipulated by the Financial Ombudsman Service.

The recent volatility in worldwide stock markets has opened up potential problems for many investment companies who may not have invested strictly in-line with their customer's requirements at all times. In the bull market when shares were rising and profits seemed easy to come by there were few complaints but now the market has collapsed many are checking the fine print of their investment service agreement.

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