FSCS Compensation: Your Questions Please

Mowerman

Martin

Please see my earlier post of 25 October in this surprisingly short thread.

Understandably all the focus in this and the numerous the numerous other threads in forums has been on those whose money was still in an Icesave account when the bank collapsed. However, as I already explained, I took last minute action to pre-empt the loss of my ISA funds. The FSCS guidance does not address this issue, as they are concerned with paying compensation to those who had lost money.

However I think it would be grossly unfair if I was left worse off than if I had actually left the money in the account and had required compensation.

It would be good to get confirmation that you are actually going to raise this issue - if necessary with the Treasury - if you have not already done so.

SGE1

Baldur wrote: »

You need to clarify the last statement.

• Have you paid any new money into the Icesave ISA since 6th April this year?
• If so, have you also paid new money into the Cash ISA opened this tax year?

If the Icesave ISA funds are from the previous tax year/years, it should be a simple ISA transfer but the process has yet to be published by the FSCS. If you have paid into two Cash ISAs in the same tax year, then one will be voided.

Sorry I didn't make it clear - I opened up my Icesave ISA this tax year, and transfered my previous ISA into it - so I only have one ISA, the Icesave one. I have paid money into it, as well as transferring the balance of my previous ISA, but not the maximum £3,600 - I still have about £2k left.

I rang up FSCS, and the person I spoke to seemed to think that because I'd opened up the Icesave ISA during this tax year, I wouldn't be able to open up another one until 6 April 09 - though by this time the ISA certificate would have expired. The guy didn't sound too sure of himself though, which is why I have doubts.

Baldur

Your returned Icesave ISA and the certificate, which will be supplied by the FSCS, will count as a transfer - so you can complete a new ISA provider's transfer process, just as you did with your old Cash ISA transfer into Icesave. Following the transfer, you would be entitled to subscribe the balance of this tax year's £3,600 allowance into the new account.

SGE1

Baldur wrote: »

Your returned Icesave ISA and the certificate, which will be supplied by the FSCS, will count as a transfer - so you can complete a new ISA provider's transfer process, just as you did with your old Cash ISA transfer into Icesave. Following the transfer, you would be entitled to subscribe the balance of this tax year's £3,600 allowance into the new account.

Thanks - that what I thought/hoped.

AP

I have an Easy Access account, an ISA and 3 fixed rate accounts with Icesave. With the recent interest rate cut, I am quite happy to let the fixed rate accounts (paying 6.70% to 7.01%) to run their course until maturity as the money would now be 100% save under FSCS.

My question is: If I am going to wait for the fixed rate accounts to mature before withdrawing the money, which will involve a paper-based application, am I still allowed to use the electronic process to withdraw the money from the Easy Access account and the ISA?

i.e. Would it be possible to 'mix and match' the payment methods on the different types of accounts that I have?

~Chameleon~

AP wrote: »

I have an Easy Access account, an ISA and 3 fixed rate accounts with Icesave. With the recent interest rate cut, I am quite happy to let the fixed rate accounts (paying 6.70% to 7.01%) to run their course until maturity as the money would now be 100% save under FSCS.

My question is: If I am going to wait for the fixed rate accounts to mature before withdrawing the money, which will involve a paper-based application, am I still allowed to use the electronic process to withdraw the money from the Easy Access account and the ISA?

i.e. Would it be possible to 'mix and match' the payment methods on the different types of accounts that I have?

Yes! You will have the option to treat each account on an individual basis so you can immediately transfer the Easy Access and ISA accounts via electronic payment and leave the fixed accounts where they are until maturity.

Primrose

Good news about being able to "mix & match" withdrawals, partly electronically and partly by paper as we too have a combination of accounts. I suspect that most people, following Thursdays BoE interest rate cut will opt to leave their accounts to mature if they don't need the money in a hurry. Quite apart from anything else, reading other reports, it seems to be a bit of a nightmare at the moment trying to chase best alternative rates, with overworked Call Centres.

edda

How will the paper certificate issued for the Icesave ISA work?

For example, if I have £21,000 invested and I receive one certificate with that amount on, how can I put £7,000 in 3 different institution's ISA offerings as I want to split the money?

I don't want to put all my ISA in one place only, but wondered if opening the 1st new one with some of the transferred money meant I have to give up my certificate - thereby losing the proof that I still have some tax free money left to invest.

Will there be a mechanism where the 1st bank can indicate the amount used up on the certificate (as it will be a partial transfer only)?

~Chameleon~

Good question! I assume they won't accept photocopies of the certificate, although i would rather hope they will as I'm not too happy about posting off the original certificate to have it get lost in the post of bank's processing dept.

I wonder whether you should give FSCS a call and ask if they might be able to issue you several certificates for smaller amounts?

AP

edda wrote: »

How will the paper certificate issued for the Icesave ISA work?

For example, if I have £21,000 invested and I receive one certificate with that amount on, how can I put £7,000 in 3 different institution's ISA offerings as I want to split the money?

I don't want to put all my ISA in one place only, but wondered if opening the 1st new one with some of the transferred money meant I have to give up my certificate - thereby losing the proof that I still have some tax free money left to invest.

Will there be a mechanism where the 1st bank can indicate the amount used up on the certificate (as it will be a partial transfer only)?

The easiest way is probably to use the certificate to transfer the whole amount into the 1st institution initially. After the account is open and up and running, immediately organise another transfer for part of the amount into the 2nd and 3rd one.

I think it is not a good idea to complicate things any further than they are. You know what bank staff are like, as soon as the slightest thing out of the ordinary comes up, they can just mess it up big time and you don't want this to happen.

As far as I can see, I'm not sure how you can use the certificate to transfer the amount into an internet-based e-ISA. So the best thing is probably to make an appointment at a branch to see an 'advisor', bringing the certificate, your cheque for the full amount shown and all relevant ID's with you and explain that you had an ISA with Icesave.

For £21k, the best one that I found is from NatWest which pays 6.45% including a 1st year bonus of 1.76%.

See: http://www.natwest.com/personal/savings/g2/isas/cash-isa.ashx#tabs=section4 for details.