Endowment Misselling not attached to a mortgage

mayb_2

defender_of_the_weak wrote:

Couple of points

Surely the complaint encompasses the churn of the personal pension. What would be the position if the original policy had not been cancelled.

I have just caught up with the word churn and what that means - yes I think that this is what happened. Did I pursue my claim on the wrong basis - should I have focused on the pension issue? I did cancel the pension of my own choice as I felt I couldn't afford it. I was, however, then persuaded to spend twice as much on its replacement. The CIS have admitted in writing to the Ombudsman that (in their words for a lump sum at retirement) I wanted to continue saving towards a pension, so there was no doubt in their minds that they were selling me this to directly replace my pension.

EdInvestor

mayb wrote:

Maturity value - projected in 2004 as 10,600 at 4% and I don't think this is being achieved at the moment.

At least you did the right thing by cashing in If you had placed the surrender value in a savings account at a net 4% also paying in the premoiums to matuiry you would end up with 12,203.

That compares with a guaranteed value of c.10k and a projected maturity value of only 10,600, suggesting the terminal bonus would be meagre indeed.As you can see there are some high charges dragging on performance in there, which possibly reflects the fact the premiums were being collected at the door.

mayb_2

Thanks EdInvestor. That reassuringly tallies with what our IFA said at the time - we actually bought Premium Bonds with some of the money and made more in two months than we had made in a year of CIS bonus pay outs - without paying any money in premiums (sorry Martin I have read your article re Premium Bonds but personal experience so far says they are good and fun too) . The FA's theory was that if we stopped paying premiums we would be saving every month - whereas if we carried on paying we would be giving our money away. We now have ISAs.

We didn't even know we could cash our policy in whilst continuing to make a complaint and so paid out for far longer than we should have - that really hurt.

Is there not some rule about how much money can be used from an investment fund to cover running costs - because our IFA agreed that some very high costs were being taken out of our premiums?
ps we had to pay this one by direct debit so no one was collecting at the door for this particular policy.

EdInvestor

Is there not some rule about how much money can be used from an investment fund to cover running costs - because our IFA agreed that some very high costs were being taken out of our premiums?

Nope.There's not even a rule forcing them to disclose what they're charging.In many cases hidden costs double the price.

The FSA has been asked repeatedly to force companies to reveal the hidden charges but it won't budge.

mayb_2

Wow - what can I say to that. I really am on my own with this one. The FSA publishes guidelines that are very often not backed up in law. so this is really a sort of gentleman's agreement which can be flouted with no penalty.

I have written to the FSA under the Freedom of Information Act asking them what they had done about a complaint I made against the CIS regarding actual breaches of the regulations.

They had already told me they were not required to let me know what if anything they would do about it, although they were taking my complaints seriously.

They told me in a phone call, that I would be receiving a written reply as requested, but nothing happened. I have written again as the Act requires that a response be given within 21 days and this has long gone. I have had no response to that letter either. Who do I complain to if the FSA is breaking the rules itself?

dunstonh

Wow - what can I say to that. I really am on my own with this one. The FSA publishes guidelines that are very often not backed up in law. so this is really a sort of gentleman's agreement which can be flouted with no penalty.

That isnt correct. Many in the industry wish there was more based in law as the penalties would be lower and there would be the right to appeal. The FSA fine and remove individuals with no right of appeal.

I have written to the FSA under the Freedom of Information Act asking them what they had done about a complaint I made against the CIS regarding actual breaches of the regulations.

They had already told me they were not required to let me know what if anything they would do about it, although they were taking my complaints seriously.

They are correct with that response. That has been tested in court.

Who do I complain to if the FSA is breaking the rules itself?

They arent breaking any rules though. They have no requirement to give you this information.

mayb_2

Sorry but you are wrong Dunstonh - they are required to respond to requests for information under the Freedom of Information Act and to abide by its rules. If they have a legitimate reason to refuse to give this information under the Act they must put this response in writing (they had a request for the response to be given in writing) and they must indicate the parts of the Act that they are invoking to refuse.

When the FSA fist told me that they would not be letting me know what actions they had taken this was not to do with the Freedom of Information request, but to do with the original complaint. The reason they gave for this was that they had a duty to protect public confidence in the Financial Services Industry. They interpreted that to mean that they didn't need to give me this information as it would undermine confidence. I do not know the reasons they have not complied with my request under the Act - but their reasons when they are given must incorporate the Act itself - not the remit of the FSA. They may end up being one and the same thing but they must reply to me one way or the other.

You may wish to check the Act out yourself - it is available to read on the website. I would be interested to know if you interpreted it differently.

I have copied the following from the FSA website on Freedom of Information requests.

From January 2005 we have been responding to individual requests for information. Any person who wishes to exercise the right of access to information that we hold must write to or email us specifying the information requested, if it is not in our Scheme. Subject to certain exemptions, we must inform the person whether we hold the information and provide it within 20 working days of receiving the request. This applies to any information we hold including that of our predecessor bodies

dunstonh

Sorry but you are wrong Dunstonh - they are required to respond to requests for information under the Freedom of Information Act and to abide by its rules.

I'm sorry you are wrong. This was tested in court and later high court where the judge found that information does not need to be supplied when it can be potentially used to aid a complaint. The case involved the FSA as well.

mayb_2

You misinterpret what I am saying - they do not have to supply the actual information if they have proper grounds for not doing so, but they do have to respond in writing to a request for information. It is not acceptable for them to just ignore it. Also this information is not required to further a complaint against the company - but to see if any action was taken by the FSA against a Company.

Whilst on the subject - why should a court protect a company from having its behaviour exposed in this way. It could not 'aid a complaint' if the company was innocent of any wrongdoing. If the FSA refuses to supply informtion it can only be because there is something it wishes to keep from the public domain. If they found that the Company in question had not broken any FSA rules and no action needed to be taken, then why would they wish to withhold that information from the public. It could only enhance the reputation of the firm in question surely.