Act now on mis-sold endowments: new article

vinno65

Darren.m wrote: »

New Thread.

Hi, has anyone got any advise please.

Before I realised there was a lot of help on the web for mis sold endowements I had started a claim with my Policy seller. I have said to them that I believe I was mis sold my endowement because I was told that there would either be enough money to pay off my mortgage 2 or 3 years early or if I went the 25 year term there would be considerable money left over.

Basically I took out an Endowement Mortgage for £47200 back in late 1990. In 2001 I then borrowed a further £25000 on a repayment option. Well, today I have received a letter from my Policy seller asking " I would be grateful if you could clarify why you decided to take your additional mortgage on a repayment basis".

Before I answer, I thought it wise to see if anyone has the 'right answer'. Its obviosly a question which could have influence over their decission.

Many Thanks,

Darren

Hi Darren,
For what it's worth I believe the firm are trying to trip you up old cynic that I am. If you tell them that the reason you took out a repayment in 2001 was that you were no longer prepared to risk your mortgage on an endowment, due possibly to the bad press they were starting to recieve at the time, they could use this as an argument to timebar your current complaint, on the basis that you were aware of the risks of endowments back in 2001 so why didn't you complain then???
As i said I am very cynical about the whole complaints process, but what has the fact that you took out a repayment mortgage in 2001 got to do with your complaint about miss-selling 10 years earlier?

Regards Vinno

ps you could just tell them to mind their own!

Mr_helpful

Before I answer, I thought it wise to see if anyone has the 'right answer'. Its obviosly a question which could have influence over their decission.

Why not tell them the truth instead of concocting a story with the so called "right answer" If you need to do this you have just told me your claim is fake.

Pet48

I've contacted the bank that sold me the endowment mortgage, I was passed on to the provider - which turned out to be different to the one on my original letter. I have been pushed from pillar to post and now don't know where to turn. Any advice would be gratefully received.

Regards

Petula

Sparkly

vinno65 wrote: »

Hi Sparky,
post to NU if the person at the bank was a tied agent then they will be responsible if not they will tell you who to complain to, probably Natwest if the person worked for them,

Vinno

Thanks Vinno

vinno65

Pet48 wrote: »

I've contacted the bank that sold me the endowment mortgage, I was passed on to the provider - which turned out to be different to the one on my original letter. I have been pushed from pillar to post and now don't know where to turn. Any advice would be gratefully received.

Write to the new people. The bank were probably tied to the original provider thus although it was their person that offered the advice they are off the hook. The original provider may well have been taken over by another firm who will now be responsible for handling the complaint.

Vinno

mayb_2

Mr Helpful
Please read post number 824 by Vinno65 then ditto it from me. The company is looking for ways to avoid its responsibility. If it has all of the correct documents from the original sale and they show the product was not miss sold then they wouldn't be asking the question at all. It is what you knew at the point you bought the product that counts - not what you found out since - if that was the case nobody reading Money Saving Expert advice could make a claim, because now they know why they should not have bought the product in the first place.

Art_2

This mis-selling saga has been going on so long and the insurance industry hasn't done itself any favours in the way it has handled the matter.

One other aspect I would like to know about. What happened to all the salesmen who sold these policies and earned large commissions for doing so? Was any action taken against them?

Regards,
Art.

mayb_2

I think you may find the answer to your question is probably a big fat NOTHING don't you? Some were sent for further training so that companies could comply with the requirements of the regulator I think. I also have a feeling that some payment to them continues until you stop paying the premium. I am sure someone will correct that statement if it is wrong - I do know it applies to some types of salesmen. Will be interesting to see the experts replies on that one.

dunstonh

This mis-selling saga has been going on so long and the insurance industry hasn't done itself any favours in the way it has handled the matter.

True. Upheld endowment complaints should never have resulted in a cash payment. That just encouraged people to complain for the hope of a windfall. Upheld complaints should have had a minimum payment on maturity of target amount. As simple as that.

One other aspect I would like to know about. What happened to all the salesmen who sold these policies and earned large commissions for doing so? Was any action taken against them?

Most are long gone. Those that are still around have all complaints recorded on their file. That can lead to disciplinery action for staff members (rarely does unless gross misconduct) or in increased PI premiums for independents. Self employed IFAs pay the redress out of their pocket (upto excess on PI cover which is typically a couple of grand). Where did you think all this money is coming from?

And for those of us that havent had any endowment complaints, we have to pick up the bill for those that have long gone. FSA, FSCS levies are over £3200 per adviser this year.

remember commission doesnt go straight in the pocket. I had over £50,000 of expenses this year. Nearly £7000 of it is to cover regulatory requirements and that doesnt include network costs. Most of that covers regulatory requirements and thats another £17,000. In anyone's book, £24,000 to cover regulatory issues is a lot of money for a single adviser (i havent added in the costs of my other adviser that works for me). You may think commissions are high but the costs are too. My software bill is about to go up another £5000 a year shortly!

I think this is where you see a divide in quality. I pay the bills. If there is a complaint, it comes out of my pocket if upheld (this is the same for any self employed/partnership IFA). That really sharpens the mind and makes sure the advice you give is good. Employed advisers have no personal liability for the advice they give. I bet you that if they did, they wouldnt sail as close to the wind as some do or have in the past.

mayb_2

For once I find myself agreeing with some of the things you have posted dunstonh. I think I need a lie down.

I am not too worried about your bills though - I remember my husband's indemnity insurance was in direct correlation to the amount of money he had earned and I have a feeling yours is too. Anyone self employed has to cover the costs involved in whatever industry they are involved in - the bonus being they don't have to share the profits either. I am sure you know exactly where to place your own money for maximum returns and are not suffering over much from the sort of problems posted on this site. I have a feeling that you have an accountant to ensure that you don't have to pay anymore tax than you have to either.

"Upheld complaints should have had a minimum payment on maturity of target amount. As simple as that."
now that bit sounds all right to me. My endowment only promised to pay off my mortgage amount anyway so it would have done exactly what it said it would do. Instead I was offered a £25000 shortfall at maturity.

This does fall down though for those who thought they had their pensions covered too - no time to make up for one of them now - so not a fair deal all round. I have a feeling though that most people would have been financially better off if this had been the case. Some people wont have dealt with their shortfall because they can't afford to, some will be time barred and get nothing - so overall I do agree with you with a caveat that those people promised pensions should get one of those too.