Every day, people across the UK are discovering that the financial advice they once trusted might not have been in their best interest. From pension transfers and risky investments to inappropriate recommendations from a financial adviser, mis-selling can take many forms, and it can cost you thousands.
But what exactly is financial mis-selling?
How do you know if it applies to you?
And what can you do if it does?
Let’s break it down.
What is financial mis-selling?
Financial mis-selling happens when you’re given poor advice, sold an unsuitable product, or not told about the risks or costs involved.
This might involve:
- Being recommended something that doesn’t suit your needs or financial situation
- Not being given the full facts before agreeing to a transfer, loan or investment
- Being pressured into a decision or misled about the benefits
- Receiving advice from someone with a conflict of interest (e.g. earning commission)
It’s not always easy to spot mis-selling at the time. In fact, most people only realise years later, once the product starts underperforming, or they try to access their money and realise something’s not right.
Common examples of financial mis-selling
Here are some of the most common types of mis-selling we see at Claim My Loss:
Pension Transfers
Many people have been encouraged to transfer out of a Final Salary or Defined Benefit pension scheme, even when doing so wasn’t in their best interest.
These schemes offer a guaranteed income for life and giving that up can be incredibly costly. Yet thousands were advised to move their pensions into personal schemes like SIPPs or SSASs, often without understanding the risks.
Red flags include:
- Not being told you were losing guaranteed benefits
- Being told you’d get ‘more flexibility’ without a comparison
- Being encouraged to invest your pension in high-risk or illiquid assets
If you transferred your pension based on advice that didn’t put your needs first, you may have been mis-sold.
Investments
Some people were advised to put money into high-risk investments, such as:
- Unregulated property schemes
- Green energy or storage bonds
- Overseas developments
- Complex or tax-driven financial products
These often-promised better returns, but they were unsuitable for many investors, especially those looking for low-risk or long-term stability.
Warning signs include:
- Losing money unexpectedly
- Being told it was a ‘safe’ or ‘guaranteed’ investment
- Not being told your money would be locked in for years
Financial Adviser Claims
Mis-selling often begins with poor advice from a regulated financial adviser. While most advisers act in their clients’ best interests, some fail to:
- Properly assess your needs and financial situation
- Explain the risks, alternatives, or long-term consequences
- Disclose conflicts of interest (such as being a tied agency, commission or referral fees)
You might have been mis-sold if:
- You were steered towards a product that didn’t suit your circumstances
- You lost out financially and weren’t told why
- The adviser made it difficult to get answers after the fact
Even if the adviser or firm no longer exists, you may still be able to claim compensation through official schemes.
How do I know if I’ve been mis-sold?
You don’t need to be an expert to know something feels off.
Here are some questions to ask yourself:
- Was I properly informed about the risks and alternatives?
- Did the advice seem rushed or one-sided?
- Has the product or scheme left me worse off financially?
- Did the adviser or company benefit from my decision?
If the answer to any of these is yes, it’s worth checking whether you could make a claim.
You could be owed thousands in compensation
Financial mis-selling is more common than most people realise, and you’re not to blame. Even if it happened years ago, you may still be eligible to claim compensation through the Financial Services Compensation Scheme (FSCS) or the Financial Ombudsman Service (FOS).
What to do next
You don’t need to find all your paperwork or understand every detail of what went wrong. Our team can guide you through the process – quickly, clearly and without obligation.
It takes just two minutes to check your eligibility.
