Wealthy investors are turning to the internet to vent their anger at poor advice from private banks.

Thousands of rich clients are suing top private banks such as Coutts and Barclays Wealth, which they accuse of advising them to invest in an AIG Life fund, only to suffer potential losses of up to 12%. Many more were caught up in the Bernard Madoff fraud, and have lost faith in their banks’ ability to carry out due diligence on investment products.

They are therefore turning to a new breed of website that allows them to run products past fellow investors rather than relying on discredited advisers — a kind of “peer review” for investment products.

Networking groups such as Peers, Family Bhive and Pi Capital provide forums that allow the well-heeled to offer each other advice and share tips. Caroline Garnham, founder of Bhive, describes the website as a “Facebook for the affluent”. Since it opened last April its popularity has surged.

“Before the Madoff affair came to light, many people were whispering that nothing could be as good as he seemed — and these are exactly the kinds of views that should have been aired,” she said.

“We’re hoping that by allowing members to voice concerns anonymously, corporate products are going to be scrutinised more openly.”

Sir Paul Judge, 59, a businessman and philanthropist in London, uses the site. “Given the poor advice we have received from the professionals in the past, everyone is now looking for stories from real people with real life experiences,” he said.

Members are put in the amber category if they have assets of £5m to £20m, jade for those with up to £100m, and jet for those with more than £100m. To join, they must provide evidence of wealth, such as a letter from an accountant or trustee.

There is no joining fee for individuals, but corporate members such as C Hoare & Co and Rathbone pay £10,000 a year to promote their products per section on the site.

The Private Asset Management (PAM) awards this month recognised the top performers in various investment categories — but previous big hitters, such as Barclays Wealth and UBS, were not among them. Many of the winners were less well-known private banks, such as Ruffer and Ermitage.

These awards are based on several factors, including performance over one and three years, staff and client retention, the overall volume of assets managed, and reliability of data. James Anderson, the awards chairman, said: “If you are a private client, your biggest challenge today is to find whom out there you can still trust.”

Here we talk to the winners.

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