The devil’s in the detail: financial providers must disclose the fine print
Financial institutions must disclose all material conditions tied to products they sell to you — or risk the ombud’s wrath
Financial institutions must disclose all material conditions tied to products they sell to you, cases shared by the financial ombud last week demonstrate. Former financial services ombud Noluntu Bam found that a woman was improperly advised when she transferred her retirement savings to a preservation fund after taking one third as a withdrawal, as she then emigrated and wanted access to more of her savings before reaching retirement age, but preservation fund rules prevented her from doing so. According to the rules of a preservation fund, a retirement fund in terms of the Pension Funds Act, you can make one partial or full withdrawal from the fund. In this particular instance, however, the ombud convinced the company to pay the woman a settlement because its representative knew the woman would need access to the money before retirement, but sold her the product anyway. So, the company did not give the complainant all the info as required by the Financial Advisory and Intermediary ...
Would you like to comment on this article?
Sign up (it's quick and free) or sign in now.
Please read our Comment Policy before commenting.
Subscribe now to unlock this article.
Support BusinessLIVE’s award-winning journalism for R129 per month (digital access only).
There’s never been a more important time to support independent journalism in SA. Our subscription packages now offer an ad-free experience for readers.
Cancel anytime.
Questions? Email helpdesk@businesslive.co.za or call 0860 52 52 00. Got a subscription voucher? Redeem it now.