Investment risk & product provider liability for IFA missales: the Seymour case

In the case of Seymour v Ockwell, [2005] EWHC 1137 the High Court considered how liability for retail product misselling should be assigned between provider and distributor. Adam Samuel analyses its thinking.

In its July 2005 paper on Treating Customers Fairly, the FSA repeated the traditional view of the relationship between client, broker or IFA and product provider. It said: “Broadly speaking, the ‘producer’ of the financial product is responsible for operating or managing the product according to the key features and other marketing literature that it prepares and distributes and that these provide a fair and balanced picture of the terms, nature and risks of the product. The seller or distributor of the product by contrast is responsible for its own marketing effort and, when giving advice, for ensuring that the product is suitable for the purchaser.”