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Mis-Sold PEPs

The appeal of investing your savings in stocks and shares is very attractive, particularly when there is the promise of a large return on your investment. For this reason, PEPs were once very popular with people wanting to invest their money.

But what exactly is a PEP and how do you know whether you have been mis-sold PEPs?


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What is a PEP?

PEP stands for Personal Equity Plan. PEPs were first introduced in 1986 and were originally designed to encourage the ownership of equity to a wider demographic.

PEPs could contain unit trusts and collective investments. Investors who had PEP accounts would be able to reap the rewards of their stock market-type investments without having to pay any capital gains or income tax.

PEPs were replaced by Individual Savings Accounts (ISAs) in 1999. By 2008, all PEPs become ISAs.

As with all types of investment, there were risks involved in putting your money into PEPs. Generally speaking, PEPs were good because they existed at a time when the stock market performed well.

A lot of people who invested in a PEP still have their original investment to this day. As these were seen as a solid investment at the time, they became very widely used. As with any popular financial product, there is always a chance that your PEPs Personal Equity Plans may have been mis-sold.

If you believe that you’ve been mis-sold a PEP, get in touch today and our advisers will be able to go through your individual circumstances to assess whether there are claims to be made.

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Fill in the form below and one of our team will be in touch for a free, friendly, no-obligation chat to assess your situation.

We’ll go through your options, your rights to making a claim and discuss how we can move forward. And don’t worry, this a free assessment and we don’t take any up-front costs.

What is a mis-sold PEP?

Because the Personal Equity Plan allowed customers to invest in the stock exchange without worrying about paying income tax or capital gains tax, they became popular very quickly.

As more people started taking out PEPs, word spread about their benefits. Existing PEP holders would recommend the product to friends and family. The problem was that not everybody was a suitable candidate for a PEP and a lot of financial mis-selling started to occur as a result.

Where mis-selling occurred, many people would end up losing money without really understanding where they had gone wrong.

Financial advisers would often sell the product to interested parties without talking about the risks associated with this type of investment. Of course, banks are required to follow strict guidelines and regulations laid down by the financial conduct authority.

When selling products such as Personal Equity Plans, a financial adviser should take into account the personal circumstances of the investor to make sure they are suitable. This means finding out about their occupation, tax position, their willingness and ability to take financial risks, and how long they want to hold the investment for.

If a customer was a naturally cautious person, a PEP may not have been a suitable investment route and an alternative option should have been offered.

If your personal circumstances were largely ignored, you weren’t advised about the risks, or even if you lost money because of your mis-sold investment, then you may have a claim to make.

Our helpful team of advisers is on-hand to discuss your experiences with you to see whether you’ve been mis-sold a PEP.

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Have you been mis-sold a PEP?

Did you take out a PEP between 1986 and 1999? Think back to when you took it out. Do you remember whether the associated risk was communicated to you? If you took out a PEP and the risk wasn’t explained, then you might be able to make claims against the bank you took the PEP out with.

When seeking professional financial advice, you should expect honesty from your adviser. But where you were not granted this courtesy, there is a chance that you may be due compensation.

A PEP was a high risk investment. Before being allowed to take it out, you should have been asked about your attitude to risk. If you were risk-averse, this was not the right product for you.

While generally speaking, Personal Equity Plans tended to perform well during the period that they were popular, there were some people who lost money on their investments.

In your initial consultation with a financial adviser, they should have explained to you what would happen if your PEP didn’t perform as expected. Think back to this consultation, was this discussed?

Prior to getting your Personal Equity Plan, what was your experience with investing money? If you were completely new to investing, did the adviser talk you through how the PEP would work?

Your adviser should have spent a little bit of time with you before allowing you to commit to your decisions. They should have explained the pros and cons of the Personal Equity Plan to you before you went ahead and invested your money.

Finally, your advisers should have also discussed any other alternative products and offered you a comparison.

If you believe you have been mis-sold a PEP, you should get in touch and speak to one of our helpful advisers. We’ll be able to talk you through your experience and see whether a complaint should be made. You may be able to make claims for compensation.

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Can you claim for a mis-sold PEP?

If you think you have been mis-sold a PEP, we may be able to win compensation for you.

Before allowing you to invest your money in a PEP, you should have had the risk spelt out to you. It should also have been made apparent what would happen if the investment didn’t go to plan. Finally, your own experience of investing and your feelings about risk should have been taken on board.

If you got bad advice over your PEP, there is a chance you were mis-sold it. If this is the case, a claim could be made.

Call us today to discuss how we can help raise a complaint and help you get compensation.