Litigation against Accountants/Tax advisers

[LandRover]

Does anyone know of anyone who has sought to claim damages for bad advice in being sold the EBT schemes?

Have scheme providers themselves been guilty of misleading people and moving them onto new structures when they should have fully divulged the potential tax liabilities?

Can there be a claim made against Accountants or tax advisers, as I expect many to have Professional Indemnity Insurance?

I ask these questions as financial Services legislation is pretty tough on those selling financial products with bad advice, i.e. Pensions, Mortgages and PPI.


PS. Can I have no "You should have known" trolls, just helpful advice on questions I think others might find beneficial.

[DonkeyRhubarb]

IMHO, you'd be better off focusing your resources on fighting the tax dispute than going after the sellers.

[cojak]

There are no 'you should have known' trolls allowed in this forum, as you should know.

[WalterWhite]

The problem we have is that the scheme's themselves were legal so we were not miss-sold.

Even if we had been miss-sold then the providers fall into two camps:

a) those sticking by the clients - would you really want to start litigation against them while they are trying to help you.

b) the companies like Sanzar that have disappeared (re-branded and are still selling) so you cannot litigate against them

Which scheme did you use?

[webberg]

My previous employer was in the claims business. There business model was to claim that an investor had been mis-sold something either because it was unsuitable or just didn't do what was claimed. Once the introducer had denied this, a claim was made against one of the two statutory funds established to pay compensation, being the Financial Ombudsman Service or Financial Services Compensation Scheme.

These funds are available where the intermediary was FSA/FCA regulated.

Claims outside this envelope, i.e. legal claims, were also considered.

Safe to say that despite claims to clients of speedy and substantial payments, the various defences and arguments put up by the intermediaries had the effect of denying a good proportion of claims and substantially slowing down others. I don't have exact numbers but I doubt that more than 50 claims had been paid out (from close on xxx clients) in 4 years.

To my knowledge, other than a couple of voluntary settlements, no legal claims had been successful.

In the contractor world, most providers and accountants etc are not FSA/FCA regulated because they don't sell investments.

To prove that their advice was so incorrect as to be negligent is a long and rocky road. An accountant/lawyer would fight this every inch of the way because their reputation is at stake (as well as a substantial increase in premium for PII).

Providers, even if still around, are even less regulated, especially if in IoM although there are perhaps still ways to get them to settle. I'm aware that another adviser considers there is a means to do this but I've not investigated myself and have no opinion as to efficacy.

As DR says, frustrating as it might be, the only sensible option is to accept that no claims are likely.

BIG GROUP will look at this issue with the aid of IoM lawyers as a priority but I'm not expecting a lot of joy.

[LandRover]

My previous employer was in the claims business. There business model was to claim that an investor had been mis-sold something either because it was unsuitable or just didn't do what was claimed. Once the introducer had denied this, a claim was made against one of the two statutory funds established to pay compensation, being the Financial Ombudsman Service or Financial Services Compensation Scheme.

These funds are available where the intermediary was FSA/FCA regulated.

Claims outside this envelope, i.e. legal claims, were also considered.

Safe to say that despite claims to clients of speedy and substantial payments, the various defences and arguments put up by the intermediaries had the effect of denying a good proportion of claims and substantially slowing down others. I don't have exact numbers but I doubt that more than 50 claims had been paid out (from close on 850 clients) in 4 years.

To my knowledge, other than a couple of voluntary settlements, no legal claims had been successful.

In the contractor world, most providers and accountants etc are not FSA/FCA regulated because they don't sell investments.

To prove that their advice was so incorrect as to be negligent is a long and rocky road. An accountant/lawyer would fight this every inch of the way because their reputation is at stake (as well as a substantial increase in premium for PII).

Providers, even if still around, are even less regulated, especially if in IoM although there are perhaps still ways to get them to settle. I'm aware that another adviser considers there is a means to do this but I've not investigated myself and have no opinion as to efficacy.

As DR says, frustrating as it might be, the only sensible option is to accept that no claims are likely.

BIG GROUP will look at this issue with the aid of IoM lawyers as a priority but I'm not expecting a lot of joy.

It does look a formidable task claiming negligence as Accountants, especially Chartered would defend themselves robustly and throw lots of money at it, whereas I couldn't afford to with APNs to save up for. As you rightly stated the number of successful claims is woeful, and there doesn't seem to be the same sort of regulation that covers them for financial areas of advising on schemes.

You enter any financial transaction nowadays, you have to have so much documentation, and a cooling off period. Sadly we don't appear to have the same stringent rules for Accountants advising clients to enter financial arrangements, which is frankly wrong when they receive significant commission payments.