Act now on mis-sold endowments: new article

vinno65

mayb wrote: »

True, but not impossible this wasn't done according to rules as why would someone buy it after being shown it was not a good bet and understood that fact?

Because we are all degenerate gamblers and fraudsters, have you learnt nothing Maybe?!!

regards Vinno

vinno65

danlojo wrote: »

Hi

Does anyone still have the fight on their hands for compensation after 18 months of applying for it?

Long story cut short.........We took out an endowment in 1992 over 25 years with Mandrake. It was for £50,000 for a down payment on our first house. It is at the moment expected to hit low £30,000 if we're lucky when it's due to pay out.

Took the fight through the company who stated ,'go to the ombudsman'. In Oct 2006 we did this and was initially ruled in our favour by the adjudicator. Mandrake didnt like this and so it's now with the ombudsman and who knows when it will be dealt with?

What I dont understand is when we took out the policy we were obviously told that it would GUARANTEE a MINIMUM payout of £50,000. Luckily for us we keep all the representatives doodles, sketches and paperwork which he confirmed in black and white.:rotfl:

Why is it taking this long when I read that others have been compensated within a few months?

Just had a one way conversation :mad: with The Financial Ombudsman dept dealing with it and I guess they now realise that I'm a tad miffed.

Andrea:D

The reason it is taking so long is because of all the fraudulent claims forwarded by money grabbing chancers out for what the can get from poor old banks and IFA's who were after all just trying to help the public get a foot on the property ladder!!.

On a serious note, the FOS are now snowed under and struggling to cope with the workload. The fact that the adjudicator is for you is in your favour,but it is still possible an ombudsman may find in the firms favour.

regards Vinno

dunstonh

Dunston you keep chanting this mantra as some sort of proof that most complaints are fraudulent,but you have yet to explain why documents were lost or didn't exist(which is even worse) on a product with a life of 25 years!
It's disgraceful

Because for a period, the companies were told they should only hold on to documents for 6 years after the sale. A lot of companies culled their paperwork.

Others didnt look after the paperwork as it was perceived as non-issue. Most firms go on with little or no complaints (over 80% according to the FOS) and historically, storage of documents was a low priority and filing systems were not very reliable. A lot of old documents were ferried off to large warehouses and got lost in the process.

In the absence of documentation the FSA/FOS tend to side with the consumer, I wonder why?

Because of the general rule that if it isnt documented it didnt happen. Hence the slight bias towards the consumer. I have no problem with that.

Thats not so really, Even with Miras and LAPR and a rate of 10% (which was more like 14% back then) A repayment mortgage with decreasing term assurance was always slightly cheaper than an endowment. The only time it became cheaper was when lenders threw out 'the guaranteed sum assured plus seventy percent of the then rate of reversionay bonus's equaled the mortgage' criteria (replaced initially with a 7% gowth rate) which led to silly 10% or more gowth rate required plans, including unit linked ones without any guarantees at all.

All the endowments I did (which is early 90s) were unit linked with target growth rates of 6% or lower. The 6% ones were cheaper than repayment mortgages without fail. The 4.4% ones werent but they were sold as a way to reduce the investment risk with the client being given the choice.

vinno65

dunstonh wrote: »

Oh yes they did. You are going back to a time when the mortgages were around £200pm and the earnings for first time buyers was often under £10k a year. The savings could often be around £20pm on that monthly cost..

But Dunston you are ignoring the fact that people were told that their endowment would pay off their mortgage and pay a tax free lump sum.Compare this to a repayment and the fact that endowments were cheaper then you would be a fool to take the repayment. Unless of course the risks inherent with an endowment were fully explained to you at the time i.e. that dependent on the stock market there may in fact be no tax free lump sum and that the endowment was not in fact gauranteed to pay off the mortgage. And by explained I do not mean that in the paperwork somewhere was an illustration showing returns at 3 different % rates I mean properly explained!

dunstonh wrote: »

Most endowments that are in shortfall are are only a few thousand away. Many of those have sufficient time to put a bit more aside to make up the potential shortfall which in real terms is quite small...

If people were told that their endowment would pay off their mortgage why should they be putting money aside for a shortfall?

dunstonh wrote: »

There has been significant numbers of opportunistic and fraudulent complaints. There are no doubts that many endowments were mis-sold. However, it was nowhere near the scale that has been seen. A lot of the complaints that result in redress are because the file is missing documents or just doesnt exist. Not because they were mis-sold. ...

The chant again Dunston if you keep repating it people will believe you eventually. Figures please to back up your claims e.g. number of claims upheld by the FOS opposed to those rejected.And if documents were lost or didn't exist then this is a miss-sale as far as i'm concerned. When i was sent my policy document i was told to keep it safe for 25 years as it was very important. Surely it is not too much to ask that the firms do the same? Or did some of the documents lost incriminate?

dunstonh wrote: »

Even those that have run the FSA, FOS and been involved in the mis-selling issues at a high level have admitted that fraudulent or opportunistic claims have been a problem. ...

Again a throw away comment. How much of a problem?

dunstonh wrote: »

The flawed method of redress has a lot to do with it. My mortgage adviser showed me a complaint earlier this week the one of his clients had asked his opinion on (not against us but another firm). It was upheld and the redress payment was just over £800. However, the surrender penalty on this unit linked endowment was just over £2000 and its on track for a surplus. So, at this moment, using the current value and not the surrender value he is £1200 better off than he would have been on a repayment mortgage and heading for a surplus but still getting paid £800 redress. You would be surprised how often that is actually the case....

Why didn't firms insist on letting polocies go to term?, then if there was a shortfall they could make up the difference.

dunstonh wrote: »

You shouldnt assume that all advisers are bad and you shouldnt assume all consumers are angels.

Believe me I don't

regards Vinno

mayb_2

Well done vinno - why didn't they insist they went to term and why did they not keep documents for the life of the policy you held - unless you had finished the policy they continue to get a return on them don't they - I can see no valid reason for throwing them away. Unless of course they were incriminating. As vino also says a proper explanation at the point of sale would mean a loss of the sale in many cases.

As I have said before these people are salesmen, not advisors of any sort - your choices range accross mortgages maybe, but they are not experts on them only on the sale and which makes most commission for them.

There are good guys and bad guys no doubt dunstonh, and I don't believe you are a bad guy at all, but it isn't necessary for you to protect the whole industry because you are innocent yourself. These things did happen and on a large scale or government would not have needed to step into this at all.

kanznelson I would be thinking of writing a complaint about the lack of response and then if still no answer go straight to the Ombudsman - why not. I am assuming they fall under the Financial Regs in which case you can complain to the FSA and they will write to the company for you demanding a response. They will then file your complaint against this person/company and pick it up for you. If they find against him he will be sanctioned and may have to pay you for any financial loss caused by his lack of response.

Good Luck.

dunstonh

There are good guys and bad guys no doubt dunstonh, and I don't believe you are a bad guy at all, but it isn't necessary for you to protect the whole industry because you are innocent yourself. These things did happen and on a large scale or government would not have needed to step into this at all.

I am not supporting any one side. I have said countless times that there were mis-sales. However, there is a lack of balance on this thread where some assume all were mis-sales and that the consumer is perfect every time.

Any attempt to balance it and give explanations to why these things happen get shot down and I am then accused of bias. I thought that knowing why some of these things happened was helpful. Whilst you question things like document storage and why a lot of firms didnt keep them. I give a reason and then its ignored. I remember when data protection came in as I was at a bank at the time and there was a paranoia of what could and couldnt be kept past 6 years. I look back on that and realise that the paranoia was misplaced but at the time that is how it was.

Opportunistic and fraudulent complaints are such an issue that the FSA is considering removing the ability to complain to the FOS from a new category of adviser they have proposed to bring in during 2009. These advisers will be the current salesforces (the same ones that account for the majority of all complaints). Other proposals have been that consumers are charged for making complaints and refunded if upheld. That has been rejected (and rightfully so).

I have seen the evidence of some of the complaints received. They are clearly opportunistic and often when further questions are asked, the person making complaint changes their story or has even admitted that they didnt write what was in the complaint, the claims company did and they were told that would increase the chance of success. I have even seen one case where the claims company accidentilly left its prompt sheet in there telling what people should write in the answers on the FOS forms and it said that it doesnt matter if that didnt happen as they will have to prove it. Basically, encouraging people to lie.



Here is a bit from Walter Merricks, Chief Ombudsman in 4/10/05:

What has changed in the last few years is that we are now dealing with many more complaints. Over four times as many – from 25,000 in our first year to an expected 115,000 this year. We now employ around 1,000 staff in our office in London’s Docklands. Over 60% of our cases relate to mortgage endowments. In most of our complaint areas it’s only in a minority of cases that we uphold the complaint and reverse the firm's decision (around 30% of cases) – although this figure rises to around 45% for mortgage endowment complaints.

On the whole, the Financial Ombudsman Service’s experience tells a positive story for IFAs. We continue to see relatively low number of complaints from you, compared to those coming from other sectors. The annual levy you pay us is minimal compared to those you contribute to the other parts of the regulatory regime. An IFA firm with three partners pays a levy to us of £75 this year. And the modified case-fee structure now means that only firms that receive more than two complaints in a year pay case-fees. This means that only 5% of firms covered by the ombudsman service paid case fees in the financial year 2004/05.

---

I have been happy to contribute to this thread whilst balance was allowed. However, seeing as any attempt to explain (and those explanations can often help understand why things happened) or show balance is now interpreted as bias, I no longer see any reason why I should continue posting on it.

Baskervilleboz

Morgan Green Cold Called us Ref Serps contracting out . Mr Foolish here just lost £500 to MG despite them saying that if a claim was not worth pursuing then they will refund monies.

What happened next may be happening to thousands of others.....

Suprise, Suprise.... It all ended up with Ombudsman and Morgan Green saying they are suprised at the verdict..... but there is NO REFUND !!!!!

It will not cost any more (!) if we can provide further information Re Serps contracting out info. Seems like a dead duck.

We feel stung.

Have heard that COLD CALLING by companies like this is illegal ; If so Who do we contact for further advice please?

We were lead to believe that this was failsafe BEWARE it is not! We suspect that many cases are being referred to Ombudsman and then rejected.

Could it be be that after the 14 day cooling off period MG know that the Ombudsman may/ will be involved and Morgan Green will not be able to refund unsuccessful claims under this scheme.

If so they will not tell you.

The understanding is that they only pursue claims that will have have any success - We believe this may be a neat sidestep by MG when the Ombudsman is involved and MG will NOT be refunding based on any Ombudsmans negative verdict .... Is this not miss-selling ? This outcome was never explained in the cold call or at any other time by Morgan Green. We were lead to believe that they will only pursue cast iron outcomes - This is sadly NOT the case! BEWARE!
:mad:

dunstonh

Baskervilleboz, Morgan Green are one of the dodgiest claims companies out there. Most of their complaints are fraudulent (ironic you should post after comments higher up saying fraudulent complaints arent a problem).

They tell lies to get you to pay £495 up front with little hope of success. Unless you contracted out of serps after the age of 45 or were earning less than around £10k p.a. at the time then it will not get classed a mis-sale. Anyone younger than 45 and earning over that amount has clear benefits to being contracted out.

The FSA did a review of contracting out and found a failure rate of less than a few percent (i think it was around 1.5% from memory). So, Morgan Green conned you into paying £495 up front for a 1.5% chance of success.

Contracting out is not a mis-sale. However, Morgan Green tell outright lies by telling you that it is. The SIB (what is now the FSA) did a check on the benefits of contracting out in 1996 and found that everyone contracted out to that point was financially better off. The stockmarket crash at the early part of the decade saw some worse off but the recovery after that improved things again and now most are still financially better off and even those that are not are only a little worse off. However, by the time they consider that the Govt is about to reduce contracted in benefits again and that you cant take a tax free lump sum out of contracted in benefits but you can with contracted out and that you can take contracted out benefits at any age after 55 (50 until 2009) but not with contracted in, then most people are happy with the contracting out decision.

Check the pensions forum out and do a search for Morgan Green for more information on this company. You will regret not having checked this website first I'm afraid.

Crazy_Saver

dunstonh wrote: »

I am not supporting any one side. I have said countless times that there were mis-sales. However, there is a lack of balance on this thread where some assume all were mis-sales and that the consumer is perfect every time.

---

I have been happy to contribute to this thread whilst balance was allowed. However, seeing as any attempt to explain (and those explanations can often help understand why things happened) or show balance is now interpreted as bias, I no longer see any reason why I should continue posting on it.

Don't go dunstonh, you are one of the few posters on here whose opinions I always liten to and on the occassions when I dissagree, they always make for an interesting debate.

I have to say though, I have not yet come across any poster who has claimed that all endowments were mis-sales. We are all fully aware that there are "bad eggs" out there but it does seem that the few innocents who are fighting their case and being unjustly treated by the financial world are always being doubted. As you keep saying yourself, "don't tar us all with the same brush".

Maybe not in those exact words, but I'm sure you understand where I'm coming from.

I actually don't think the original policy that we were sold would have been classed as a mis-sale. We still have two letters stating the estimated surplus we should expect to have received. Therefore I would have hoped that we would have been guaranteed to have our mortgage covered as there is no mention in either letter that there could have been a shortfall.



Keep up the good work dunstonh:cool:

Regards

Crazy Saver

vinno65

dunstonh wrote: »

I am not supporting any one side. I have said countless times that there were mis-sales. However, there is a lack of balance on this thread where some assume all were mis-sales and that the consumer is perfect every time..

Dunston
If you were to read some of your posts, rather than balanced you do give the impression that most claims are fraudulent but there were some miss-sales
However the evidence presented to the Select Commitee puts miss-sales at 50% of all sales.As i keep pointing out to you most people were not sold their endowments by IFA's but by the large banks and this is where the majority of miss-sales occured. This is evidenced by your link referencing Walter Merrick who also points out that they have little problem from IFA's.
He does however also say that 45% of endowment cases are overturned in favour of the consumer so how many legitimate claims are being turned down by firms? Is this not a form of fraud? I would imagine that a lot of people give up when they recieve their final reply from firms so arbiterily dismissing claims could turn out to be a money spinner for them. Unless of course they are caught by the FSA and fined massively!! (escuse me whilst i die laughing).

So don't take it personally, keep sticking up for IFA's, but remember most people only experience the big banks(and some dodgy estate agents) and that most people who contribute to this thread have a genuine grievence and don't like to be tarred with the same brush as fraudsters.

regards Vinno