We use cookies to allow us and selected partners to improve your experience and our advertising. By continuing to browse you consent to our use of cookies. You can understand more and change your cookies preferences here.

Your rights as an investor

When you invest your money with a firm and they are authorised by the Financial Conduct Authority (FCA), you get significant protection if you're not happy with the service you’ve received.

In this article
Which investments are protected? What rights do I have if an investment performs poorly? How can I check if an investment firm is regulated?
Claiming compensation through the FSCS Making a complaint through the FOS

Which investments are protected?

All investments involve risk and you could lose money.

Certain providers of investments are however covered by the Financial Services Compensation Scheme (FSCS) and the Financial Ombudsman Service (FOS). That means if they go bust, you could get your money back.

The FSCS can compensate you by up to £85,000 should a provider go bust. The FOS can force a firm to pay you more than £350,000.

However, to be eligible for assistance, you investments must meet certain criteria:

Financial Services Compensation Scheme Financial Ombudsman Service
£85,000 limit per person, per provider £350,000+ limit (increases with inflation)
Provider must be regulated by Financial Conduct Authority (FCA) Provider must be regulated by Financial Conduct Authority (FCA)
Investment must be regulated by FCA* Provider is based in the UK
Provider is based in the UK  

*you may still be able to claim if an independent financial adviser recommended the unregulated investment


What rights do I have if an investment performs poorly?

Not many: neither the FSCS nor the FOS is designed to cover poor performance.

This can create confusing differences, as in this entirely hypothetical example:

If you invested using well-known investments platform Hargreaves Lansdown, and it went bust, you would be covered by the FSCS.

If you invested in Hargreaves Lansdown as a shareholder, and it went bust, you would not be covered. Nor would you be able to complain to the FOS, as there would no longer be a company to complain about.

You may be able to make an FOS complaint if you were sold an investment, that later performed poorly, without being made fully aware of the risks involved.

How can I check if an investment firm is regulated?

Always check a firm's status on the Financial Services Register - criminals can easily make a website display the FCA and FSCS logos, or convincing-looking numbers.

You can search the register by company name, person of interest, postcode or by sing the firm's unique reference number (FRN).

The register also includes firms that are under investigation, with prominent warnings.

Is the investment regulated?

Bear in mind that FCA-regulated firms can still sell unregulated investments.

If you put your money into them, you're unlikely to be covered by the FSCS, unless the investment was the result of negligent advice from an independent financial adviser.

Unregulated investments include:

  • Bitcoin, and all other cryptocurrencies
  • Mini-bonds
  • Peer-to-peer investments
  • Luxury investments i.e. fine wines, art
  • Unusual investments i.e. car parking spaces, burial plots, shipping containers

If in doubt, don't invest. Do more research and consult the FCA's Warning List.

Also be aware that even regulated investments can be extremely high risk.

Claiming compensation through the FSCS

If you've lost money because of an authorised firm’s dishonesty or negligence, normally, you'd seek compensation through the firm (using FOS if your complaint is not originally upheld).

But your chances of getting money from the firm evaporate if the firm goes out of business.

The fastest way to claim is to create an online account with the FSCS. You'll then need to upload any supporting documents, such as emails and statements. The FSCS says this process takes around 90 minutes.

It's also possible to claim by phone (0800 678 1100) or by post.

Before making a claim, also consider the following:


Client money accounts


Many investment platforms hold your money in separate client money accounts, usually with UK banks.

That means, if the platform collapses, your money will be safe, and you won't have to wait for administrators to get it back.

In this situation, you wouldn't need to make an FSCS claim.


Claims management companies


Claiming with the FSCS is 100% free - there's zero advantage in using a separate claims management company.

Make sure you're using the FSCS' official website https://www.fscs.org.uk/

Making a complaint through the FOS

If you have a problem with a financial product, service or advice from a regulated firm, first complain to the firm involved. It must resolve your complaint within eight weeks. 

If you have not had a response within this time or the complaint has not been upheld, you can take your case to the FOS.

The ombudsman can order a firm to put matters right and pay you compensation of £350,000 or more (this increases each year with inflation).

If you're unhappy with the ombudsman’s verdict, you can bring a court case against the firm.

However, this can be a time-consuming and costly experience, whereas going to the FOS is free and requires no legal representation.