Poor investment advice acknowledgement by Jyske Bank

jyske-bank-littleEmbattled Danish institution Jyske Bank had admitted issuing poor investment recommendations to its clients.

The bank acknowledged at a hearing with the Danish Complaint Board of Banking Services that investors had been improperly advised and that losses should be reimbursed. The board found that inadequate consultations were given in five of the customer cases brought before it.

In recent months, Jyske Bank has been sparring with authorities over the Jyske Invest Hedge Fund Market-Neutral Bonds, which have allegedly squandered DKK 800 million (USD 129 million) of investors’ funds. The bank has already lost a number of cases on the issue with the board, although fault has only been admitted in the most recent five, reports The Copenhagen Post.

Jyske Bank’s head of legal affairs, Peter Stig Hansen, denied that the bank had changed its position with the recent u-turn. “There’s no news in this matter,” said Hansen. “We assess cases individually, and in these cases we came to the conclusion that we risked losing them if you judge them with an ordinary burden of proof.”

The Danish Complaint Board of Banking Services and the Consumer Ombudsman have both instructed Jyske Bank to hand over documentation relating to 10,000 hedge fund investments after overturning an earlier ruling from the Financial Securities Authority.

The complaints board has reversed the decision, meaning Jyske Bank must now show proof that it provided customers with accurate and comprehensive guidance.