FOS rewards the mis-selling wrong-doers etc.

Garry_Anderson

Oh - by the way - you may want to read this.

I presume my learned friend knows what a fiduciary position is (they are like the people that churned customers).

The equitable jurisdiction

2.23 The equitable jurisdiction gives courts an inherent power to award interest, which may on occasion extend to compound interest. The Law Commission’s 1978 Report on Interest described the equitable jurisdiction as follows:

Interest may be awarded as ancillary relief in respect of equitable
remedies such as specific performance, rescission or the taking of an
account. Furthermore the payment of interest may be ordered where
money has been obtained and retained by fraud, or where it has been
withheld or misapplied by an executor or a trustee or anyone else in a
fiduciary position.

2.24 It was noted that where money had been obtained by fraud or misapplied by someone in a fiduciary position, the court “may direct that such interest be compounded at appropriate intervals”.

http://www.lawcom.gov.uk/docs/lc287(1).pdf

vinno65

dreamylittledream wrote:

Vinno - the point is however that most people who have had an endowment mortage haven't paid more then they would have paid on a repayment mortgage. If they had paid more then this would have been returned as part of the redress. So I'm still left wondering how it can be argued they have lost out..

Hi Dreamylittledream, that's fine and dandy for those who have had a complaint upheld, what about those who haven't? Will they be paying more in interest over the term of the loan compare to those with a repayment or not?

In the context of Gary's posts about a "conspiracy" its not hard to see how providers and building societies/banks colluded on endowments. Do you not think the the providers approached the banks and building societies saying "look tie in with us flog loads of our endowments, we'll pay you for flogging them and not only that its tied to an interest only loan over 25 years so you'll be quids in there aswell!!"

Let's not be naive here you know this sort of thing goes on. It's the respectable financial services industry getting their grubby little hands on some extra cash, though technically not illegal (though some of their selling tactics were) it's morally bankrupt especially considering their actions at present now that it's all gone tits up!!

regards Vinno

Garry_Anderson

Dear Vinno - don't you think it strange?

Now that the public have found out that endowments are not fit for purpose - they have disapeared from view - not one advert have I seen.

You don't see those big adverts from finance companies no more - pushing mortgage endowments down your throat like they used to.

I am sure you can see what has happened in the past and realise that none of it required any historical perspective - all that guff about nobody has hindsight makes me want to laugh.

They have been found out and don't want to pay full restitution for their crimes.

My wife and I have been defrauded out of many many thousands with this churning alone - and we are only one of the many families that the management of our building society that got conned exactly like this.

Despite what some of the experts here would like you to believe - this is not some wacko conspiracy theory - I have actual documentary evidence.

I have won official complaint against FSA proving that they lack integrity - so am no idiot when it comes to logic and knowing the difference between facts and opinion.

You replied to Dreamers, "Vinno - the point is however that most people who have had an endowment mortage haven't paid more then they would have paid on a repayment mortgage. If they had paid more then this would have been returned as part of the redress. So I'm still left wondering how it can be argued they have lost out.."

It is clear Dreamer thinks that nobody has lost out with the FOS - I have not seen the exact formula - so I would not take anybodies word for that.

It was alwas completely obvious whose side the FOS and FSA were on - and it wasn't the consumer.

I demonstrated how they were wrong about churning formula - in that people lost out on a great deal of money with not being given the compound interest.

I am sure that you do not need be told - but for sake of some others here reading this - don't take nobodies word for anything until you see it proven

dunstonh

You don't see those big adverts from finance companies no more - pushing mortgage endowments down your throat like they used to.

For exactly the same reason you don't see Ford advertising the Cortina any more.

Garry_Anderson

Garry Anderson> You don't see those big adverts from finance companies no more - pushing mortgage endowments down your throat like they used to.

Dunston> For exactly the same reason you don't see Ford advertising the Cortina any more.

Yet you do see them advertising the Model T - guess why.

You use bad analogy - this new 'car' wasn't designed to be fit for purpose of making your journey.

So - regarding churning - at least can we agree that the Ombudsman could give compound interest to victims if he really wanted - to put them back in position they should be - and that it is in the finance companies best interest that he does not?

We all know you would never agree about endowments - having 95% of your business in investment portfolios - you would not want public to lose confidence in markets

dunstonh

You use bad analogy - this new 'car' wasn't designed to be fit for purpose of making your journey.

Didnt stop people buying Rover Metros.

Plus, only you are saying that they not fit for purpose. Not others.

We all know you would never agree about endowments - having 95% of your business in investment portfolios - you would not want public to lose confidence in markets

It has nothing to do with it.

Garry_Anderson

Dunston> Didnt stop people buying Rover Metros.

Funny.

Endowments were not designed by finance industry to repay massive loans - indeed nobody can say they are fit for purpose of mortgage repayment.

Dunston> Plus, only you are saying that they not fit for purpose. Not others.

Because the crooks are conflating purpose with the enducement of extra cash - and finance industry is keeping quiet because of wanting confidence in markets.

The facts speak for themselves - endowments were proven not fit for purpose of large loan repayments (and the finance companies certainly knew this - it did not require hindsight).

Also the Ombudsman actually said they were unfit for purpose - you will note he didn't say who and why they would be fit for purpose.

GA> We all know you would never agree about endowments - having 95% of your business in investment portfolios - you would not want public to lose confidence in markets

D> It has nothing to do with it.

Like I say - you are funny

The endowment and repayment mortgages were sold as interchangable by crooks who were only interested in taking money from their victims.

What was the split at the height of endowment sales 60/40?

dreamylittledream

vinno65 wrote:

Hi Dreamylittledream, that's fine and dandy for those who have had a complaint upheld, what about those who haven't? Will they be paying more in interest over the term of the loan compare to those with a repayment or not?

In the context of Gary's posts about a "conspiracy" its not hard to see how providers and building societies/banks colluded on endowments. Do you not think the the providers approached the banks and building societies saying "look tie in with us flog loads of our endowments, we'll pay you for flogging them and not only that its tied to an interest only loan over 25 years so you'll be quids in there aswell!!"

Let's not be naive here you know this sort of thing goes on. It's the respectable financial services industry getting their grubby little hands on some extra cash, though technically not illegal (though some of their selling tactics were) it's morally bankrupt especially considering their actions at present now that it's all gone tits up!!

regards Vinno

Vinno - I accept this entirely and as I've pointed out my argument revolves around redress being carried out correctly. If the borrower has been unjustly denied redress (due to a timebar for example) I agree this can not be in anyway argued as fair.

However Garry is arguing that endowment mortgage redress itself is unfair - which I do not accept (with some notable caveats).

As for the grand conspiracy theory, I think too much of this is being viewed through hindsight. Endowments were popular because they had achieved good results in the past - bank and building societies would have been foolish not to have offered products which were often requested by their customers.

We are all aware that there were many sharp sales practices going on at the time, and that risk based investments are generally unsuitable for the majority of mortgage borrowers. This doesn't mean however that the products should not have been offered at all.

vinno65

dreamylittledream wrote:

As for the grand conspiracy theory, I think too much of this is being viewed through hindsight. Endowments were popular because they had achieved good results in the past - bank and building societies would have been foolish not to have offered products which were often requested by their customers.

We are all aware that there were many sharp sales practices going on at the time, and that risk based investments are generally unsuitable for the majority of mortgage borrowers. This doesn't mean however that the products should not have been offered at all.

Hi Dreamy,
I take your comments but wonder just how many people actually asked for an endowment? I believe in would have been a tiny amount. I touched on this in a post to Dunstonh where he claimed that many people asked for endowments because their relatives had one or the saw a report in the Mail saying how wonderful they were. I put it to him that it would be nearer the truth that the seller actually used these as selling points, something along the line of "haven't your relatives GOT an endowment and look at this article in the mail saying how wonderful they are"

Getting back to the conspiracy theory, whilst not advocating that there is some great scheme I do believe that there has been a massive collusion between the industry and the FSA/FOS. The excuse that a full scale review along the line of that taken over pensions just doesn't wash. The fact is this endowment scandal if handled properly had the potential to bankcrupt the industry. BY allowing the firms to handle complaints as they saw fit has got us into this mess now. What have the FSA actually done? They have fined a few firms, great but hardly punative. FP were fined £675,000 for miss-handling complaints. At an average redress figure of £5000 say that equates to 135 successful complaints!! They have over 400,000 policies.
The head of the FSA also sent a letter in 2002 to all the ceo's warning them that they were not doing what they said they would do. Have you read the Tiner letter? Do you believe that firms are now adhering to the Tiner points? Of course they're not and they are getting away with it because the FOS let's them. John Tiner the head of the FSA says in this letter that firms should accept the verbal evidence consumers offer them about what happened at the sale regards guarantees etc. yet firms reject this without documentary proof and the FOS does also!!! I had to go to court where the judge accepted my version of what happened at my sale although I had no written evidence to back it up. She looked at all the facts and made a considered judgement, why can't the firms and the FOS do this? Because it would end up costing the industry billions!

You know yourself whats happening about people sold endowments into retirement, how is this in anyway fair or reasonable which is what the FOS keep spouting on they are. Why have they case histories on the web site (showing how redress should be calculated properly in these cases) yet routinely uphold timebars on this aspect if raised by a firm. It pays no heed to justice or common law and as my case shows they are wrong.

The rule change on time bars brought about because the house of commons said they were unfair. The big three ceo's sat in front of the MP's and said they had no intention of imposing time bars. 14 of the 17 major players also said they would not impose time bars. What's the figure now?

Also why was the rule change not retrospective? The MP's said it was unfair to impose time bars based on the original "red letters" the FSA decided to change the rules but why no lift of the already imposed time bars? Pressure from the industry perhaps? 700,000 timebarred in 2003 could have been quite costly heh?

The more you look into this the more you can see, I believe that there is collusion between the industry and the FSA/FOS. The fact that the house of commons had a select committee entitled "Restoring confidence in long term savings" speaks volumes. The Insurance industry was in danger of going under and people have no faith in it anymore, not just because of endowments. This would never be allowed to happen though we all know that but unfortunately its the consumer that carries the can, yet again!

regards Vinno

Garry_Anderson

dreamylittledream wrote:

Vinno - I accept this entirely and as I've pointed out my argument revolves around redress being carried out correctly. If the borrower has been unjustly denied redress (due to a timebar for example) I agree this can not be in anyway argued as fair.

However Garry is arguing that endowment mortgage redress itself is unfair - which I do not accept (with some notable caveats).

As for the grand conspiracy theory, I think too much of this is being viewed through hindsight. Endowments were popular because they had achieved good results in the past - bank and building societies would have been foolish not to have offered products which were often requested by their customers.

We are all aware that there were many sharp sales practices going on at the time, and that risk based investments are generally unsuitable for the majority of mortgage borrowers. This doesn't mean however that the products should not have been offered at all.

Let us first of all work on the premise of your last sentence - we will demolish it later

You say your "argument revolves around redress being carried out correctly".

In order for you to know that - you would know the exact formula - what is it?

I have shown how redress for churning is to detriment of victim i.e. they do not receive the compound interest they would have i.e. denied money they have REALLY LOST.

I shown the 'Arbitration Act' and 'equitable jurisdiction' which directly covers this.

As I said, "simple interest would give £2.94 redress for every pound churned - when we should get at least £4.31 at the smallest rate given in compound interest".

So - "Why do the FOS screw consumers out of proper redress?"

As to being "viewed through hindsight" - this is bogus argument.

Endowments were designed by finance industry to be offered as interchangable with repayment mortgage - as demonstrated by large scale advertising.

Though you say it "generally unsuitable for the majority of mortgage borrowers"

It wasn't simply "requested by their customers" - demand was generated by finance industry - see documentary evidence from top management of Woolwich BS on complaint site https://www.WoolwichSucks.co.uk

Finally - let us deal with your premise - for whom exactly is endowment good financial advice?