Children's entitlement to BS merger windfall

NeoNurse

I've been looking for this information for a long time but but just can't find any 'solid' answers, I'm hoping someone here will be able to point me in the right direction.

Myself and each of my three children had savings accounts with Staffordshire building society. Shortly following the birth of each child my mother opened a savings account for them with a gift of £250.00. These accounts were opened in their names (proof of ID provided in the form of birth certificates) and as an adult has to have the power to make decisions on their behalf until they are old enough I signed the forms to take that responsibility. Their birthday/Christmas monies are deposited each year, and a one-off lump sum was deposited when they each received some money in my nan's will.

When the Staffordshire merged with the Portman building society we each received windfall payments based exclusively on the amount in our individual accounts, ie each child received a windfall payment based on the amount of savings that they held in their account in their name. However, when the Portman merged with Nationwide the windfall payment was much smaller than the minimum guaranteed amount per saver (by hundreds of pounds) and came as one cheque addressed to me. I called Nationwide and explained an error had been made and received a callback several days later. The woman I spoke to said that despite the fact that the accounts were in my children's names and the money held in the accounts was entirely their money, my signature as the adult with control of the account meant that their money was lumped into one sum with my savings and they were not entitled to a windfall as individual savers.

I reluctantly accepted her explanation though I said I didn't understand how that could be correct - how could I receive payment for money that wasn't mine and the children not receive payment? She told me it was the law and Nationwide were powerless to do otherwise, and that the Portman had messed up by issuing windfall payments to the children's accounts.

Can anyone shed any light on this? Has Nationwide followed the correct procedure or just found a way to try to avoid paying a windfall sum to their child savers? Everything I've read on this (amazingly informative) site indicates that a child's savings are separate to their parents so I'm starting to query whether the information I was given by Nationwide is correct. Any help or advice would be much appreciated...

martinman3

Some of what the Nationwide employee told you was incorrect, many children with accounts at Portman did receive windfall cheques. There were some, however, who did not though.
http://www.thisismoney.co.uk/saving-and-banking/article.html?in_article_id=418997&in_page_id=7

I can confirm that if "SOLE" was printed alongside the child's name on the passbook of the Portman Young Saver account with an adult as signatory then the child received a windfall. It is interesting how many comments on the article were from people in Staffordshire.;)

It may depend on how the Staffordshire accounts were handled by Portman after the merger. Did they give you a new passbook ? How were the names on the account printed ? Were the words "trustee" or "re" used ?