Dipak was talking on the telephone with his financial adviser about an insurance refund he was expecting to receive. The call ended, but Dipak’s financial adviser did not end the call. Dipak was shocked and distressed to hear his financial adviser talk to someone else about him in very unkind terms.
When the financial adviser ended the call Dipak texted him back saying that he would be making a complaint. The financial adviser responded explaining that he was working from home and the person he had been talking to was a mutual friend. The financial adviser went on to repeat in a text the things Dipak had overheard in the conversation.
Dipak complained through the financial adviser’s internal complaints process. The regional manager apologised to Dipak and said that he had spoken to the financial adviser who agreed with the content of the call, and that the comments he overheard were personal and not work-related.
Dipak asked to be transferred to another financial adviser, unrelated to the person he was complaining about. The financial adviser’s firm’s regional manager referred Dipak to a senior financial adviser in the same firm but did not tell Dipak that the new financial adviser worked two days a week in the same office as the person Dipak was complaining about.
When Dipak discovered the two people were colleagues, he was very upset and felt the regional manager had lied to him. Dipak asked for another financial adviser. This time Dipak was referred to a completely different branch, but the person who called him was dismissive of Dipak’s needs.
Dipak complained to FSCL that the financial advice firm had not taken seriously the original disclosure of personal information and then had not offered a level of service that allowed him to trust his new financial adviser.
Dispute
The financial advice firm said they had apologised to Dipak and reminded the adviser about confidentiality. However, because the conversation was personal in nature, they did not consider any further steps were necessary. During the initial phases of our investigation the firm offered Dipak $1,500 as compensation, but Dipak did not accept the offer.
Dipak explained that he was receiving counselling for a diagnosed post-traumatic stress disorder (PTSD) and that overhearing the comments from his financial adviser was extremely distressing. Dipak provided a statement from his registered psychotherapist confirming that Dipak’s experience with the broker had triggered his PTSD symptoms. The psychotherapist explained that Dipak had seen the relationship with his broker as a relationship of trust and felt his trust had been betrayed causing disassociation. Dipak’s further experience, when he requested a new broker, left him feeling unheard and again triggered his PTSD.
We issued a preliminary decision giving our view that the financial advice firm’s response to Dipak’s complaint was inadequate in Dipak’s particular circumstances. The financial advice firm had acknowledged the discomfort, hurt, and humiliation the adviser’s actions had caused Dipak and had apologised, but they did not appear to appreciate the seriousness of the situation for Dipak.
The adviser’s comments were unprofessional and, even if they were of a personal nature, they should not have been made during work time. The financial advice firm then failed to care well for Dipak when referring him to another adviser in the same office.
Without the complication of Dipak’s personal circumstances, we may have found that $1,500 was adequate compensation. However, given Dipak’s vulnerability, the consequences for him were far greater and warranted an increased amount of compensation of $3,000.
Resolution
Both Dipak and the financial advice firm accepted our view, and the complaint was resolved on this basis.
Insights for participants
With more people working from home, participants need to ensure that staff are trained to ensure a professional service is provided at all times. It is never acceptable to discuss a client with another person outside the office. While there may be relationships between financial advisers and clients that blur the professional/personal lines, if a financial adviser feels they can no longer provide impartial advice, they should step aside.
