Report Endowment Misselling Compensation SUCCESSES

mayb_2

Whatever the base this is not natural justice turbobob. If the companies were to be proactive and offer a redress to those people who bought these unknowing of the risks, then there could be a time bar for uptake. The fact is that, particularly in the case of low cost endowments, the sellers knew it was highly unlikely that these products would reach target. The companies know who they are and they also make each person fight their individual battle for redress. Justice is therefore, randomly obtained for a few and denied to many others.

It is also true that far more people have put their claims in since the timebar was introduced - they can no longer afford to wait to see if their product will come anywhere near its target. This has meant a large increase in cases before the ombudsman, as well as an increase in the numbers of staff within the ombudsman service. Investment funds are being depleted by the people cashing in on them and gaining redress - I would have thought this would make it more difficult for that fund to succeed for those remaining in it.

As others have sugested, it would have been far wiser for companies to offer to make up any shortfall experienced at the end of term. This would have enabled the company to maintain the investment whilst it worked to cover the shortfall. Instead everyone and his brother wants their money back. Not good news for anyone. Nobody was about to get the extra amounts they had been promised over and above the mortgage cover so they were already being shortchanged.

Now why should it be the homeowner who carries the cost of all of the mistakes made by the financial institutions? I have a feeling they will survive, but that is not true for some of the people hit by this. Yet we allow an arrangement that makes it harder for the homeowner and leaves a problem to be solved at a later date. It has led to a deep mistrust amongst the possible customers for these people, which was finally responsible for the rush to withdraw funds from Northern Rock, and in the current climate may yet happen to another institution. Trust has been lost and nobody has really gained from this. The finance industry has been shown to be a greedy, conscienceless monster with no real accumen for its job - quick profit and cut and run tactics will not enhance its reputation - it is time for some change of approach, which could start with support for those it has let down with their endowments - many of which were also supposed to fund a pension.

treliac

Well said mayb!! Why is it that the FOS and those wealthy and powerful companies involved cannot take such an obvious and fair approach. The problem has been exposed and should have been tackled honestly and properly.

The trouble is, each indvidual one of us, separately, has absolutely no power to achieve an equitable response for all. There's simply no way to take this "greedy monster" on.

1Sam17

turbobob wrote: »

For what purpose? I.e. what are you hoping to get out of it? I'm sure there will be people who didn't receive one or don't remember receiving one. They could have gone to an incorrect address for example. I know the firm I work for sent them out in January 2000 though.

That is my point, there may be some firms that did not even post this Factsheet and letter in January 2000 and I have evidence for suggesting this.
I'm not suggesting that any firm failed to send it for an underhanded reason as I have no evidence to say this, but none the less it seems they were under an obligation to send it.
If anyone has been time-barred and is doubtful that this factsheet was sent to them, surely there is no harm in asking the company to clarify.
Do you think the customer would have an argument against a time bar if it could be shown that the company did not comply with their obligation?

turbobob

Its an area I'm not totally sure on as where I work don't rely on any of the 2000 warnings or the first FSA leaflet for the purpose of time barring. From my experience of dealing with FOS they tend to say that the first "red" letter must have clear wording that there was a high risk the policy would not pay off your mortgage, and that you should take action now. This wasn't always the case with the first phase of letters in 2000.

If you could prove that the January mailer wasn't sent I guess this would strengthen your case, but beyond that I can't really comment.

mayb_2

I think that you have to have had a final warning letter 6 months before the cut off period too 1Sam17, explaining that you can claim. I think people should make their claim even if the time bar has kicked in as they can also say why they didn't act before that date. It would at least mean an explanation has to be given as to why the time bar is being used - this may be challengeable if the reasons are not valid. It is not a system that is both unfair and unjust, so logic is not being applied anyway. It should not be possible to reject a claim based on the time that it was submitted, rather than the reason being it was not accepted as being missold. Many valid claims have been rejected without that anyway, the aim now is not to have to deal with them at all - so avoiding the cost of processing them as well as the cost of paying out on a claim.

1Sam17

mayb wrote: »

I think that you have to have had a final warning letter 6 months before the cut off period too 1Sam17, explaining that you can claim.

Unfortunately prior to the FSA rule change in mid 2004, the situation was even worse for many people as the Red warning letter did not even have to mention that the customer could make a complaint for compensation , let alone that their was a deadline in which to complain. All it had to say was that the customer was advised to consider taking action- that meant consider taking action on how else to make up the possible shortfall on the mortgage and my red letters only gave options for doing this.
That is why the January 2000 Factsheet and 'warm up' letter were so important for lots of people in my situation. They were created to inform everyone that they had a right to complain and how to go about doing this and that is why all companies were required to send the Factsheet.
I don't agree why there is a general presumption by the FSA/ Ombudsman etc that all companies sent the Factsheet. In my experience at least, no one is prepared to accept our word for anything as important as this, without us being able to back it up with evidence.
Unfortunately many people to whom this applies will already have had their claim time-barred and will have accepted this, without understanding the significance of the Factsheet. Lets face it if you were not sent it at the time, how would you have been aware that it should have been sent to you?

I hope anyone else who may not have been sent the January 2000 Factsheet reads our comments and takes this matter up. If enough people do it then perhaps the authorities will take the matter seriously, that's my only aim.

treliac

We were sold a pension mortgage as a package in 1986, loan arranged and pension sold to pay it back - complete with paperwork from the provider fully detailing this complete package.

We have never had any warning from them at all to indicate the truth, that the pension plan wouldn't pay off the loan. Would get nowhere near in fact. Instead they have suggested recently that they could not be expected to know that the pension plan was intended to pay for the mortgage. (Yes, I know the whole thing's ridiculous but we were only young and at the time knew nothing more than we were told or, indeed, were not told).
http://news.bbc.co.uk/1/hi/business/1625628.stm

So, it's only recently we discovered that we could make a claim and we're now going through the FOS. I fear there are many, many more out there, with pension mortgages, who are still none the wiser.

mayb_2

There does appear to be a problem with any endowment package not directly attached to a mortgage. Nobody can deny the value of the mortgage therefore this is the promise that was made - the endowment would at least pay off the mortgage. I am not sure how they get away with saying a pension mortgage should not have been for at least the value of the mortgage and then should provide a pension as well.

Most endowment policies were sold with the promise of more than enough to cover the mortgage and so allow for a lump sum towards a pension too.

When we showed that we had had no updates on our pension savings (endowment plan) we were told that we should have asked for it. The company was not held to account for not keeping us informed. Neither did the same company give us information about an actual pension taken out by my husband and then frozen. In fact they forgot about it and did not put it on to their computerised system at all. None of these things caused so much as a raised eyebrow with the Ombudsman or FSA. Neither did the fact that the actual fund for our endowment had been closed without our being informed cause them to act. The site link giving this information was immediatly closed and dissapeared from view to be replaced by a link to the FSA site. If I didn't have many copies of this information I would think I had dreamt it. I had just shown this site to the FSA when this strange thing happened. I had shown it too many others who then noted the same thing.

It would appear that they can regulate these companies in only so much as the companies choose to allow themselves to be regulated. If the financial companies say - stop chasing us on that old chap I'm afraid we can't afford to pay up on those,the FSA and Ombudsman service obligingly back off. Now that mortgage endowment claims are squeezing these companies too hard (in their own opinion) they have got the FSA to agree to the time bar rule.

We are up against huge and powerful institutions here and it would take the power of government to take them on - or perhaps a Martin Lewis. Having witnessed what the governement was prepared to do with taxpayers money to bail out the Northern Rock Bank and how it is going nicely asking the bank to help out all their customers over the credit and mortgage crunch, I do not hold my breath for any help on this issue. The Banks call the shots and we all have to dive for cover as the gun as always is pointed at the little people.

I can see where 1Sam17 is coming from and he is right in saying that the more the merrier - what you really need is a solicitor who will gather all the claimants together and challenge it in court as one action. Then we might see something happen. This is sort of what was happening over bank charges - one ruling could then set the scene for all future dealings in that same area.

plunk_2

provider : legal and general
amount : £917!!

basically, took the endownment in 1999, when i bought my first house, received the standard letters saying that the endownment wouldnt pay the mortgage off, used the letter from which, and got the above settlement today.

Sunny_Donny

Halifax £3,500
Changed part of mortgage to repayment and used the money (well £3000) to overpay and reduce it further. My endowment is with Standard Life and is only expected to pay out 60% in 2014 - if we are lucky!! Have been making regular overpayments per month (between £5 and £10) and lump sums in where I can. Will keep on doing this so that when endowment finally coughs its last there may be a little over in the kitty!!!!!