Insights for investors
If you miss important communications from your investment manager, it can limit your ability to make decisions about your investments.
If a provider makes a reasonable offer to recognise a loss, FSCL may not be able to consider your complaint. Before bringing a complaint to us, consider whether the provider has already tried to fairly address your concerns.
Honey’s investments are closed without her knowledge
In 2021, Honey invested $2,000 in two investment funds managed by an investment fund manager.
In 2025, the investment fund manager decided to close the funds to new investments and, shortly afterwards, decided to wind up the funds altogether. The investments were sold and the money was paid back to investors. Honey received approximately $700 in total.
Unsubscribing meant missing fund closure emails
The investment fund manager notified investors of their decisions by email. Honey had previously unsubscribed from the investment fund manager’s email communications, so she didn’t receive the notification. She became aware of the closure after logging into her account and seeing that the funds had been wound up and the investments were no longer held.
Honey missed chance to act before liquidation
As Honey had not received notification of the decision, she did not have an opportunity to decide what action to take before the funds were liquidated. Honey emphasised that she was not complaining about investment performance, but the lack of notice that locked in her losses at $1,300.
The investment fund manager’s solution
The investment fund manager acknowledged that investors should not be able to unsubscribe from important account or fund updates, and updated their processes. The investment fund manager also made a goodwill payment of $400 to Honey. This was calculated by considering the growth the investments may have had if they had remained invested until the date Honey became aware of the funds being closed, plus a little more.
Honey did not agree with the fund manager’s offer, and complained to FSCL.
FSCL’s view: loss of opportunity vs investment performance losses
We considered whether the complaint fell within our rules, known as our terms of reference. Under paragraph 20, we may decline to investigate a complaint if a reasonable settlement offer has already been made.
We accepted that Honey’s complaint was not about investment performance. It was about the lack of notice and the loss of opportunity to act before the funds were wound up, as she missed the chance to decide on what to do with her money before the investment closed.
We considered that the impact of not receiving the emails was a loss of opportunity during the time between the funds being wound up and Honey becoming aware of that. We considered that the $400 payment fairly recognised the lost opportunity because it placed Honey back in the position she believed she was in during that period.
FSCL finds the fund manager had offered a fair solution
We did not consider it fair to require the investment fund manager to compensate Honey for the difference between the original investment amount and the amount returned on liquidation, as that loss reflected the performance of the investments rather than the loss of opportunity caused by the notification issue.
We also took into account that the investment fund manager had updated their systems to prevent investors from unsubscribing from material account and fund updates.
We concluded that the settlement the fund manager had provided was reasonable and that it was fair to decline to consider the complaint under our rules.
What was the outcome of the case?
We declined to further investigate the complaint because a reasonable resolution had already been offered, and we closed our file.
