Managed Savings Account - reclaiming assets

aquaman74

Hi,

Apologies for the long post. I'm new to forums, and somewhat nervous at what response I'll get (and whether I'll ever see my money again).

I'm wondering if anyone can help with some advice on managed savings accounts. Back in 2001 I was contacted by an independent financial adviser (who had got my contact details from someone I knew) while I was posted in Hong Kong who then took me through the spiel about saving for the future and after 2-3 meetings, I ended up agreeing to a managed savings account as a tax efficient savings vehicle.

I agreed to make monthly payments and quite a large percentage of my monthly salary went into the fund. A few months later I was laid off, but continued to pay into the fund as I was made aware that defaulting on any payments would be heavily penalised. Needless to say it took me much longer than anticipated to find a job and ultimately I had to stop paying in altogether. I was quite ashamed at the time and rather than trying to deal with it then, I put it to the back of my mind and pretty much forgot about it.

I have just rediscovered my policy papers and thought I should really try and see what I can salvage from my situation, given I am again in hard times. The fund was a single premium whole life insurance policy. The total value of my payments was around GBP 10,000 over approx 15 months and I would love to get some of it back. Looking at the papers it seems the fund charges 105% of the first year's payment or 13 months instalments, then there is an early exit penalty, as well as a commitment penalty for not keeping up payments. I remember being concerned I may lose my income at the time of signing up, but was told it would be easy to reduce payments and make them up later. What concerns me is that I have thrown away my money to someone else's commissions with absolutely nothing to show for it. Is there a case for misselling here?

This was my only savings investment and I had not invested before, other than picking up some lastminute.com shares in the IPO (again, naive!). On reflection, this fund doesn't seem to me like a sound basis for an investment portfolio given the risks of default and the variable performance nature of the fund. I fear I succumbed to the likeable but pushy salesperson/IFA who stood to gain high commissions in the first year of my investment, leaving me high and dry later. I was/am single and have absolutely no need of life insurance and invested in the fund thinking it was a savings fund. If I had had more information I would have avoided it like the plague, but I thought an IFA should provide good independent advice with my interests at heart.

Another problem for me is that the investment was made while i was in Hong Kong, with the fund (Royal Skandia) being based in the Isle of Man. My policy documents all have the Isle of Man address on it.

The IFA company who advised me does not seem to exist any more. I have not yet contacted Royal Skandia about trying to access the funds I paid in as I wanted to get some advice/ideas who to turn to for advice first. Do I have any rights in dealing with Royal Skandia? I'm sitting here feeling that getting myself into this situation was my fault and I'm the only one I can blame... I fear there's nothing I can do to get any money back. Possibly not fair given that I feel I was pushed into it. There was a 14 day right to cancellation at the time but I stupidly felt that I owed my IFA to go through with it despite my misgivings after spending so much time explaining it to me!! And not having any savings at all I was naturally concerned to provide for my future, little did I know...

Thanks for reading!

OneADay

I would be getting in touch with Royal Skandia.

The 105% you mention seems to mean they top up your monthly payment by 5% for the first year (according to this http://www.royalskandia.com/Investments/msa.asp).

It may have changed over time - but only way to find out is ask them (as you have all the paperwork). i.e. Find out current value and when you can get your hands on it.