Endowment mis-selling

*Rainbow*Warrior*

Can anyone advise please? We were sold an endowment on our first mortgage in 1988 - it was clearly mis-sold as we were told we would definitely get a bonus at the end and were never warned about the possibility of a shortfall.

I made a complaint and tried to claim in 2005/2006 and think I even went as far as the ombudsman. I was told that the law governing financial advice came into effect in April 1988 (I think) and since our policy was sold to us in February 1988 it was just tough and there was nothing we could do about it.

I'm just wondering if anything has changed in the last few years and is there any way I could raise a fresh complaint as I still feel very unhappy about the situation.

Thanks!

dunstonh

I'm just wondering if anything has changed in the last few years and is there any way I could raise a fresh complaint as I still feel very unhappy about the situation.

No. Not unless you have a tardis and can persuade the Govt in the 80s to start regulation earlier than they did.

How was it mis-sold if the rules about how they should be sold didnt come in until April 1988? yes, it may not have complied with regulations that later came in force (and most wouldnt come close to requirements today). However, that doesnt mean they were wrong in their day.

*Rainbow*Warrior*

Point taken. What I meant was that the kind of information we were given is exactly that which has been described as mis-selling where other people have been able to claim (having taken out a policy only a matter of weeks later than we did).

I suppose technically you can argue it was not mis-sold, but morally I would have to disagree. We were lied to either way - we were specifically told that we WOULD get a bonus at the end. Information was omitted, ie that there could be a shortfall.

Also, while I understand your point about regulations not being in force at the time, I still felt it was reasonable to ask as sometimes rules change and regulations can be enforced retrospectively (car tax, for example, I think?). With all the publicity about the banks these days I thought it was possible they had reviewed the rules.

holly_hobby

The Financial Services Act 1987, and FS regulation did not come into force until 29 April 1988 ( A Day) - so your purchase as already advised, was previous to this date.

That means that before this time the adviser had no duty to ensure the product was suitable to the clients requirements, attitude to risk or circumstances. HOWEVER they could neither make any misleading or un-true statements or claims about the contract in order to secure its sale. (this comes under the Misrepresentation Act 1967)

You say that you were verbally told the target amount was guaranteed - for a pre A Day sales you would need to provide documentary evidence of this - such as a written gte from the adviser themselves, or any illustrations and/or policy documents supporting your claim that the target sum was clearly guaranteed on maturity.

Without such, and bearing in mind the suitability issues re pre regulated sales, I am afraid that you will just have to accept that the timing of your purchase isn't ideal for your apparent claim.

In that case, here's fingers crossed that your policy matures as planned !?

Hope this helps

Holly

*Rainbow*Warrior*

Thanks for that. Sadly, it was so long ago, I can't find any paperwork confirming what I was told and the figures I was given - although I have a very clear memory of the conversation!

I wouldn't be so bothered if the policy was on target, but it isn't, it's red and looks likely to be around half to two thirds of what we were promised.

The other annoying thing - although the advice was given prior to the Act (in Feb) the policy didn't actually start until May, after the Act came into force, but that doesn't seem to make any difference either!

holly_hobby

No, its when the product was purchased, not when it commenced. To be fair at the time you purchased this, returns were very bouyant on such policies, and many purchased in mid to late 80s have matured at, and even in excess of their target sum - so claims that target sums were likely to be met, would have been made in good faith at that time - although of course could not be guaranteed .

Your EMV's showing a possible shortfall, are just that estimated ... you may find that when the policy matures things aren't as black as you think (or could be worse of course !).

If you are still using this wholly as a mortgage repayment vehicle, its obviously imperative that you need to make arrangements to deal with any shortfall that does occur at maturity (change wholly or partly to repayment, etc).

Hope this helps

Holly