FSCS and FOS Explained for Veterans: Your Rights, Your Money, Your Voice
When military service ends, the transition to civilian life can be overwhelming. New routines, new responsibilities and new financial decisions can feel like unfamiliar territory after years of military structure. For many veterans, one of the most daunting aspects of this transition is handling money — pensions, investments, mortgages and advice that, too often, is taken on trust.
But what happens when that trust is broken? What if the financial advice you received turned out to be misleading or harmful? What if your pension was moved into a high-risk scheme without properly understanding the consequences?
Thousands of veterans have found themselves in exactly that position — mis-sold financial products, lost savings and a deep sense of betrayal. The good news is that help exists. And it comes in the form of two powerful organisations: the Financial Services Compensation Scheme (FSCS) and the Financial Ombudsman Service (FOS).
In this blog, we’ll explain what these two bodies do, how they differ, and how veterans can use them to reclaim what they’re owed. Because when financial damage is done, silence is not the answer — action is.
A Quick Overview
What is the FSCS?
The Financial Services Compensation Scheme (FSCS) is a government-backed service that provides compensation to people who lose money because a financial firm has gone out of business and cannot meet its liabilities.
If a firm that advised you, arranged a pension transfer or managed your investments has since failed, the FSCS can investigate and, in many cases, compensate you up to a set limit.
What is the FOS?
The Financial Ombudsman Service (FOS) is an independent body that deals with complaints about financial services. If a firm is still trading and you feel you were misled or treated unfairly, the FOS can review your case, speak to both sides and issue a decision that the firm must honour.
Why This Matters for Veterans
Many veterans who left the Armed Forces — especially those with military pensions or lump sum gratuities — became targets for unscrupulous financial advisers.
They were told:
“Move your money into a Self-Invested Personal Pension (SIPP) for more control”
“This overseas property fund is low risk with high returns”
“You’ll save tax by transferring your pension offshore”
In reality, many of these products were high-risk, unsuitable and in some cases outright fraudulent. And for veterans used to taking advice from those in authority, the damage went far beyond money — it shattered confidence, created long-term financial stress and left many feeling deeply let down.
If this sounds familiar, you may not just be a victim. You may have a valid claim.
FSCS in More Detail: Who It Helps
You might be eligible for FSCS compensation if:
The financial firm that gave you bad advice is no longer trading
You were advised to transfer your Armed Forces pension into a SIPP or another scheme that wasn’t suitable
You invested in a high-risk product (such as overseas property, hotel schemes, storage units or unregulated investments)
You were not made fully aware of the risks involved at the time
The FSCS covers compensation for:
Mis-sold pension transfers
Failed investment products
Misleading or negligent advice
Bad mortgage advice or unsuitable insurance
As of 2024, the maximum payout from FSCS is:
£85,000 per person, per firm for investment claims
£85,000 for pensions and life insurance
Higher limits apply for certain other financial services
Even if your investment failed years ago, it is still worth checking whether you have a valid claim.
FOS in More Detail: If the Firm Is Still Trading
If the financial firm that advised you is still operating, you can complain to the Financial Ombudsman Service.
You can use the FOS if:
You were misled, pressured or not properly advised by a financial adviser or firm
The adviser downplayed the risks or exaggerated potential returns
You were not provided with documentation or were rushed into a decision
You were promised “guaranteed” returns that never materialised
Before going to the FOS, you must first make a complaint to the firm itself. If they do not resolve the issue within eight weeks — or if you’re unhappy with their reply — the FOS can step in and conduct an impartial review.
The FOS can award compensation, require the firm to take corrective action or issue a public ruling. The firm is legally bound to comply with the ombudsman’s decision if you accept it.
What You’ll Need to Make a Claim
Both the FSCS and FOS require certain information to investigate your case. Typically, this includes:
The name of the financial firm or adviser involved
The dates of your pension transfer, investment or advice
Copies of any documentation, letters, statements or contracts (if available)
A written description of what happened and why you believe it was mis-selling or poor advice
At Justice4Heroes, we can guide you through gathering this information, even if your records are limited. In many cases, we can help you recover what’s needed through solicitor support or formal data requests.
Common Misconceptions
“It happened too long ago to claim.”
Not necessarily. The time limit for FOS complaints is generally six years from the date of the issue, or three years from when you became aware of the problem. With FSCS, claims can often still be made for historic cases if the firm failed after 2001 and you meet the criteria.
“I signed the paperwork, so it’s my fault.”
Even if you signed forms, the law requires advisers to give clear, accurate, and suitable advice. Signing under false pretences or without proper risk disclosure is not consent. Many successful claims involve signed paperwork where clients were misled.
“I don’t want the hassle or cost of a legal battle.”
Our services are offered free and our legal partners work on a no win no fee basis, and take all the hassle away from you.
Why Veterans Are at Higher Risk
Military personnel often trust authority figures and may be less experienced with financial products. When combined with sudden access to lump sums or pension pots, this creates a prime target for financial exploitation.
Add to that:
Poor regulation in the 2000s and early 2010s
Lack of clear post-service financial advice
Pressure to “act now” before benefits disappear
It is no surprise that veterans were disproportionately affected by financial mis-selling. Now, years later, many still don’t know they have a route to justice.
One Veteran’s Story
Dave, who left the Royal Navy in 2002, was advised to transfer his pension into a SIPP promising tax efficiency and high returns from eco-investments overseas. Within five years, the investment collapsed. The firm responsible had gone into liquidation.
He thought his money was gone forever. But after learning about the FSCS through a veterans’ group, he investigated further. With the right help, Dave submitted a claim and was later compensated for a significant portion of his lost funds.
More importantly, he felt acknowledged. He said:
“It wasn’t about the money by then. It was about someone finally saying, ‘You were right to be angry — this should never have happened.’”
Dave’s experience is not unique. There are still many veterans out there who have not come forward. You might be one of them.
How Justice4Heroes Can Help
We work alongside trusted professionals who understand both the financial system and the military community. We don’t charge veterans to find out whether they have a potential claim — and we only work with regulated firms.
Our team can:
Help you check whether the adviser or product was involved in past mis-selling
Connect you with specialist solicitors or support teams
Provide updates on group claims or class actions affecting veterans
Assist with paperwork and understanding FSCS and FOS decisions
Share petition updates and campaign news
Even if you're unsure, we’re here to listen and support you.
Final Thoughts
Have you or a loved one lost money due to poor pension or investment advice after serving in the Armed Forces? You may have more rights than you think.
Visit www.justice4heroes.org to check whether your case might qualify for FSCS or FOS support
Support our campaign for broader compensation for pre-1987 veterans by signing the petition: https://petition.parliament.uk/petitions/715800
You followed orders. You served your country. Now it’s time your voice was heard.
