Banks may be giving risky investment advice

The Momentum UK Team 18 November 2011

Consumer campaigning organisation Which? has released a report this week suggesting that some banks and building societies are giving out poor investment advice to customers.

The undercover investigation found that only 5 out of the 37 bank and building society advisors targeted by researchers gave "good" investment advice, with the majority making misleading claims and ommisions when advising on investment products.

Almost half of advisors failed to mention the Financial Services Compensation Scheme, and only a few were "upfront" about the commission that they received as a result of recommending products.

The research was conducted using a group of inexperienced investors in the 60+ age group. Which? also tested 6 independent financial advisors with 4 being rated as giving good advice.

In a statement Which? Executive Director Richard Lloyd said:

"Now, more than ever, consumers need advice they can trust on what to do with their money. [...]

"Our investigation shows that the high street isn't the best place to go for investment advice. If in doubt, consumers should always talk to an independent financial adviser."